The Fed’s report that manufacturing activity and consumer spending rose over the past two months while jobs growth remained sluggish helped temper concerns about a coming interest rate hike. But analysts said the survey of the nation’s business climate did not hold enough upside surprise to move the markets significantly higher.

"There was nothing in the report to upset the apple cart one way or the other," said Simon Melluish, head of U.S. equities at Gartmore Mutual Funds. "We’re treading water a bit, waiting until we get new bits of news."

According to preliminary calculations, the Dow Jones industrial average ended the day up 1.63, or 0.02 percent, at 10,593.11, after spending most of the session in negative territory.

The broader gauges were narrowly mixed. The Nasdaq composite index declined 6.29, or 0.3 percent, at 2,033.36, but was well off its intraday lows. The Standard & Poor’s 500 index closed up 1.93, or 0.2 percent, at 1,151.03.

Generally good economic news and strong fourth-quarter earnings have raised optimism about the recovery, but a pattern of uneven trading has developed as investors grow increasingly nervous about when rates will rise. Stocks sank yesterday when Fed Chairman Alan Greenspan reiterated his view that interest rates must go up eventually.

The Fed has said it would be patient with its interest rate policy, but repeated indications that rates are set to rise have helped boost the dollar from its doldrums this week. Its rise against foreign currencies, including the Japanese yen, raised concern about waning demand for U.S. Treasuries from Asian central banks, and sent bond prices lower and yields higher.

The Fed survey, dubbed the Beige Book for the color of its cover, only whetted Wall Street’s appetite for the government’s February employment report, due out Friday. The importance of the labor market was underscored Monday, when stocks moved sharply higher after the Institute for Supply Management reported better-than-expected jobs growth in the manufacturing sector.

"The rally was based on the expectation of a stronger economy and now we’ve got to see it," said Ken McCarthy, chief economist at vFinance Investments. "To get to the next level to rise, we have to actually see the growth in employment."

Walt Disney Co. was down 11 cents at $26.65 as embattled chief executive Michael Eisner presided over the company’s annual meeting in Philadelphia. A recent hostile takeover bid from Comcast Corp. has fed disappointment in the company’s performance, and anger toward Eisner. Comcast was up 47 cents at $30.40.