* Bernanke says Fed committed to stimulus
* Trading volume lower than usual due to holidays, snowstorm
* Airline stocks rally as crude oil tumbles
* Dow up 0.2 pct, S&P flat, Nasdaq down 0.3 pct
By Ryan Vlastelica
NEW YORK, Jan 3 U.S. stocks ended a volatile
session mostly flat on Friday as investors digested comments
from Federal Reserve officials that raised questions about how
quickly the central bank will end its stimulus program.
Wall Street opened higher but subsequently pared gains after
Philadelphia Fed President Charles Plosser said the Fed faced
"immense" challenges now that it had reduced bond-buying, and
that it needed to be cognizant of a potential rapid rise in
Volatility was exacerbated by light trading volume, with
about 4.61 billion shares traded on all U.S. platforms,
according to BATS exchange data, well below average, with many
market participants out in the wake of the New Year's holiday,
as well as a snowstorm in the northeast.
"Plosser suggested that it might not be an easy or smooth
process for the Fed to unwind its balance sheet, which could
have been be an indication the Fed could act sooner on ending
bond buying than is currently expected," said Mark Luschini,
chief investment strategist at Janney Montgomery Scott in
Following Plosser's comments, Fed Chairman Ben Bernanke said
that the central bank was no less committed to accommodative
monetary policies despite the recent announcement that it would
slow its stimulus program. He also said the U.S. economic
recovery "clearly remains incomplete."
Equities briefly turned positive following the comments
before returning to breakeven territory.
General Motors fell 3.4 percent to $39.57, one of the
S&P 500's biggest decliners, after the automaker reported lower
December sales, below analysts' expectations of a slight gain.
Ford Motor Co rose 0.5 percent to $15.51 after its sales.
The Dow Jones industrial average was up 28.64 points,
or 0.17 percent, at 16,469.99. The Standard & Poor's 500 Index
was down 0.62 points, or 0.03 percent, at 1,831.36. The
Nasdaq Composite Index was down 11.16 points, or 0.27
percent, at 4,131.91.
The S&P's slight decline marked the first time since 2005
that the benchmark index started a year with two straight
negative sessions. For the week, the Dow fell less than 0.1
percent while both the S&P and Nasdaq lost 0.6 percent.
"Valuations are full, but not egregiously rich right now,"
said Luschini, who oversees about $60 billion in assets. "In
order for markets to really outperform now, we need to see
better growth develop and for earnings to brighten
Crude oil fell 1.3 percent, bringing its 2014
year-to-date losses to 4.3 percent, a fact that boosted airline
stocks on Friday. Delta Air Lines rose 5.5 percent to
$29.23 as the S&P's biggest gainer while Southwest Airlines
rose 2.9 percent to $19.42.
FireEye Inc surged 39 percent to $57.02 after the
cybersecurity company acquired Mandiant Corp, the computer
forensics specialist best known for unveiling a secretive
Chinese military unit believed to be behind a series of hacking
attacks on U.S. companies.
Twitter gained 2.2 percent to $69. Shares in the
social media company burst out of the gate in 2014 with a gain
of more than 8 percent.
About 62 percent of stocks traded on the New York Stock
Exchange closed higher on the day, while 59 percent of
Nasdaq-listed shares ended in positive territory.