2007: A winning year on Wall Street

NEW YORK (CNNMoney.com) -- Stocks fizzled Monday, limping through the last trading day of 2007 but will close the year with respectable gains.

At the close, the Dow Jones industrial average (INDU), S&P 500 (SPX.X) and Nasdaq (COMPX), all ended slightly lower.

For the year, major indexes have fared well despite problems in the housing and credit markets. Year-to-date, the Dow is up 6.4% percent, the S&P 500 is up 3.5% percent, and the Nasdaq is up 9.8% percent.

Treasury prices rose. The dollar gained against the euro and slipped against the yen. Oil prices climbed and gold prices fell.

Trading was light Monday as investors looked to polish their portfolios ahead of the year's end.

"Even though the numbers aren't astounding, signs point to a solid economy," said Dean Barber, president of Barber Financial Group.

The market saw drastic swings in the second half of 2007. The Dow reached a record high on October 9th, then fell more than 10% off its highs by November. Though the Nasdaq was the strongest of the three indexes, it never came close to the record it set in March of 2000.

Crude oil soared $34.93 a barrel in 2007 - a gain of 57% - and came close to the $100 a barrel mark in November.

As for next year, Barber thinks technology and healthcare stocks will continue to be strong performers and that investors will shy away from the financial services sector until the extent of the subprime debacle is known.

"There will still be some volatility but I think the markets have priced in the downturn expected in the first half of next year," he added.

On the housing front, the number of existing homes sold in November inched moderately higher, according to the National Association of Realtors. The increase was expected by economists but still helped give some companies in the housing sector a lift.

Shares of homebuilder,Hovnanian Enterprises (HOV, Fortune 500) gained 6 percent, after sinking immediately following the report.

Troubled mortgage lender Countrywide Financial (CFC, Fortune 500) gained more than 2 percent. And Washington Mutual Inc. (WM, Fortune 500), which also makes home loans, was up 5 percent.

Likewise, home improvement retailer, Home Depot (HD, Fortune 500) was trading more than 1 percent higher.

From the banking sector, Merrill Lynch (MER, Fortune 500) could receive another infusion of capital from sovereign wealth funds, according to a British newspaper, The Observer.

Last week, Merrill said it was selling a $4.4 billion stake to Singapore's state-owned investment branch in an effort to shore up its capital position after taking huge subprime-related writedowns in the company's third quarter.

Merrill's stock turned nearly 2 percent higher Monday afternoon, after lagging in the first part of the day.

Financial services companies, which have not had a good year, made a bit of a come back Monday afternoon.

Citigroup (C, Fortune 500), JP Morgan (JPM, Fortune 500) and Bank of America (BAC, Fortune 500), all traded higher at the close.

In corporate news, billionaire investor Kirk Kerkorian's Tracinda Corp. is paying $684 million for a 35 percent stake in Delta Petroleum (DPTR), an independent energy exploration company.

Market breadth was negative. On the Dow, losers beat winners eight to seven on a volume of 650 million shares. On the Nasdaq, decliners topped advancers by nearly eight to seven on a volume of 1.03 billion shares.

U.S. light crude oil for January delivery fell 2 cents to $95.89 a barrel on the New York Mercantile Exchange.

Treasury prices rose, with the yield on the 10-year note falling to 4.03 percent, down from 4.07 on Friday. Bond prices and yields move in opposite directions.

In currency trading, the dollar gained slightly against the euro and lost ground versus the yen.

COMEX gold for February delivery fell $4.70 to $838.00 an ounce.