Wall Street Closes Flat As Obama Signs Tax Deal

NEW YORK - Wall Street closed flat on Friday after a day of range-bound trade as President Barack Obama signed into law a sweeping tax cuts bill aimed at boosting the economy.

The Dow Jones Industrial Average slipped 7.34 points (0.06 percent) to close at 11,491.91, while the S&P 500 index, a broader measure of the market, gained 1.04 points (0.08 percent) to 1,243.91.

The tech-rich Nasdaq advanced 5.66 points (0.21 percent) to 2,642.97, boosted by shares of Oracle and Research in Motion after both reported strong earnings late on Wednesday.

Shortly after the closing bell, Obama signed a controversial deal he had hammered out with Republicans extending tax cuts for all income classes, introduced in the early 2000s, as well as aid to the jobless.

Congress approved the bill less than 24 hours earlier.

"The market likes certainty, for investors to know what their tax structure will look like for two years is much better than facing uncertainty when the calendar turns to January," said analyst David Levy of Texas-based Kenjol Capital Management.

Augustine Faucher of Moody's Analytics said the tax bill "will make a meaningful contribution to the economy in 2011."

"The tax-cut and benefit extensions will help protect against a double-dip recession and cushion any negative shocks, and help job growth and consumer spending reinforce each other in a cycle of expansion," she said.

Gross domestic product was now expected to hit about four percent next year and the unemployment rate was expected to decline to 8.7 percent from the current 9.8 percent, according to Augustine.

But stocks wavered throughout the day amid continued concerns about Europe's economy after Moody's on Friday slashed debt-stricken Ireland's credit rating, citing increased uncertainties over the country's economy and public finances.

In corporate news, shares of business software giant Oracle soared 3.9 percent after reporting stronger-than-expected quarterly earnings.

And Research in Motion, maker of the popular BlackBerry smartphone, also saw its US-traded stocks rise 1.7 percent after reporting strong third quarter earnings amid a rise in sales.

Shares of McDonald's rose slightly, up 0.1 percent, after Moody's raised its debt ratings for the fastfood chain on the back of strong sales and growth.

The bond market rose.

The yield on the 10-year Treasury bonds fell to 3.33 percent from 3.48 percent on Thursday, while that of the 30-year bond slipped to 4.41 percent from 4.58 percent. Bond prices and yields move in opposite directions.