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NEW YORK — Stocks ended an uneven session with moderate gains Thursday as investors vacillated between optimism and fear about the economy. The market also was trying to determine the likely impact of the change in leadership in the Senate. 

The Dow Jones industrial average closed up 16.91 at 11,122.42, after falling 60 points earlier in the session. 

Wall Street’s broader indicators followed the Dow’s path, advancing late in the session. The Nasdaq composite index rose 38.54 to 2,282.02, while the Standard & Poor’s 500 index moved up 4.12 to 1,293.17. 

Thursday’s trading was choppy from the start when Vermont Sen. James Jeffords announced, as expected, that he is leaving the Republican party to become an independent, ending GOP control of the Senate. 

“Everyone is sort of going through their own analysis of what the effect the change in the legislature is going to have for various sectors in the market,” said Charles White, portfolio manager for Avatar Associates. 

But analysts said that the market’s fluctuation mostly came amid unease over the health of the economy. Investors were trading cautiously ahead of a speech Federal Reserve Chairman Alan Greenspan was scheduled to deliver Thursday night before the Economic Club of New York. 

“The next quarter or two are going to be weak. We already know that. What we want to hear from the Fed chairman tonight is that the fourth quarter is going to bring recovery,” White said. “The reason we have been rallying (recently) is on the hopes and dreams of the fourth quarter.” 

Adding to investors’ nervousness about the economy was weak housing and employment news. The Commerce Department reported that new home sales posted their largest decline in four years in April as rising layoffs made Americans feel less secure about making big-ticket purchases. 

And the Labor Department said that new claims for state unemployment insurance rose more sharply last week than analysts expected. 

It was more difficult to gauge precisely how Jeffords’ move was affecting Wall Street, where some profit-taking had been expected following the market’s big runup since early last month. Stocks have advanced primarily because of the five interest rate cuts by the Federal Reserve this year. 

The Dow has jumped 1,732.94, an 18.5 percent increase, from its March low of 9,389.48. The Nasdaq has gained 461.18, or 25 percent, from its March low of 1,820.57. 

The market also can’t be expected to sustain such upward momentum as long as investors have reason to worry about the economy, said Alan Ackerman, executive vice president of Fahnestock & Co. 

“The averages moved too far too fast without any real strong earnings development,” Ackerman said. “The market has overreacted to the cumulative Fed rate cuts.” 

The economy and politics aside, stocks still managed to post widespread gains. Microsoft rose $2.02 to $71.72, and General Motors advanced $1.41 to $56.59. Home Depot moved up 83 cents to $53.45, and Intel rose 41 cents to $29.21. 

However, analysts said politics pulled down pharmaceutical and energy shares, sectors that typically benefit from a Republican Congress. Merck dropped $1.50 to $72.50, while Enron fell $1.19 to $54.16. 

The slowing economy hurt makers of semiconductor equipment, which reported late Tuesday that customer orders for April dropped 41 percent from March. Triquint Semiconductor plunged $4.22 to $20.59. 

Advancing issues traded nearly evenly with decliners on the New York Stock Exchange, where consolidated volume was 1.31 billion shares, compared with 1.37 billion on Wednesday. 

The Russell 2000 index, which measures the performance of smaller companies stocks, rose 3.04 to 510.40. 

Overseas markets were mixed Thursday. Japan’s Nikkei stock average finished the day down 1.2 percent. In Europe, Germany’s DAX index rose 1.0 percent, Britain’s FT-SE 100 advanced 0.3 percent, and France’s CAC-40 gained 0.5 percent. 

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