NEW YORK—Stocks are mixed in midday trading as investors wait for news out of budget talks being held in Washington.

Big Lots soared 9 percent after the discount retailer beat analysts' earnings forecasts and raised its estimate for full-year earnings.

The Dow Jones industrial average was up 16 points at 12,982 shortly before noon Tuesday.

The Standard & Poor's 500 index was down one point at 1,408. The Nasdaq composite index fell nine points to 2,993.

Pep Boys plunged 13 percent after posting a loss on weak sales at the company's auto stores and rising costs.

In Washington, talks are proceeding on how to avoid a fiscal crunch of higher taxes and government spending cuts set to automatically kick in at the beginning of the year.