By Edward Krudy
NEW YORK (Reuters) - U.S. stocks were little changed on Friday as investors were hesitant to make big bets ahead of a statement by President Obama on the progress of budget talks in Washington that have recently driven volatility in financial markets.
U.S. President Barack Obama, visiting a factory in Pennsylvania, will press his case on raising taxes on the wealthy to narrow the deficit. He is expected to make a statement around midday that is likely to impact markets.
"There is always hope in those situations that he (Obama) is going to announce some type of positive development," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York. "We see how violently the market swings on positive and negative announcements."
Trading has been choppy as investors react to mixed statements from policymakers in Washington about discussions on averting the "fiscal cliff," spending cuts and tax hikes that will come into effect in the new year and could cause a recession, according to worst-case predictions.
Corporations continued to anticipate a harsher tax regime next year. Whole Foods Market Inc
The Dow Jones industrial average gained 5.63 points, or 0.04 percent, to 13,027.45. The Standard & Poor's 500 Index dropped 0.58 points, or 0.04 percent, to 1,415.37. The Nasdaq Composite Index dropped 3.43 points, or 0.11 percent, to 3,008.59.
The S&P 500 was on track to end the month 0.3 percent higher, after declining nearly 2 percent in October. The index has recovered 4.5 percent since shedding 8 percent following the U.S. presidential election earlier in November.
"The correction from the S&P 500's September peak has allowed overbought momentum and optimistic sentiment conditions to recede, and we believe the index is closer to an intermediate-term buy signal than a sell signal," said Ari Wald, analyst at PrinceRidge Group.
Yum Brands Inc
After a close relationship for several years, Facebook Inc
Zynga shares dropped 5.3 percent to $2.48. Facebook shares were down 1.2 percent at $26.99.
The markets' reaction to data on Friday was muted.
A report showed business activity in the U.S. Midwest expanded for the first time since August, buoyed by an improvement in the labor market.
Separately, data showed U.S. consumer spending fell in October for the first time in five months as income growth stalled, suggesting slower economic growth in the fourth quarter.
(Editing by Bernadette Baum)