US stocks: Markets little changed

NEW YORK - US stocks were little changed in light trade today, as investors avoided placing bets before the New Year's holiday.

Among gainers on the New York Stock Exchange were shares of Hilton Hotels Corp., which jumped 7.2 per cent to $23.91 after it said it will buy the hotels of its British sister company, Hilton Group Plc, for $5.71 billion.

Merck & Co. Inc. gained 1.3 per cent to $32.34 on the NYSE and helped support the Dow. Shares rose after Morgan Stanley raised its price target on the drug maker's stock to $38 from $34 citing new medicines and recent cost-cutting efforts.

"Trading volume is dwindling and we are probably not going to see large bets today and tomorrow, and especially after inconclusive economic data," said Edgar Peters, chief investment officer at Boston-based PanAgora Asset Management Inc., with $15 billion in assets.

The Dow Jones industrial average was up 20.34 points, or 0.19 per cent, at 10,816.60. The Standard & Poor's 500 Index was up 0.80 of a point, or 0.06 per cent, at 1,258.97. The technology-laced Nasdaq Composite Index was down 1.10 points, or 0.05 per cent, at 2,227.84.

Volume was lighter than average, with about 736 million shares changing hands on the NYSE at about 9am NZT.

"The only thing that seemed to really move today was oil," Peters added.

Crude prices rebounded back above $60 a barrel and lifted shares of some energy companies like heavily weighted Exxon Mobil Corp., up 0.6 per cent at $56.57. Exxon was among the Dow's best performers.

US crude for February delivery was up 50 cents at $60.32 after US inventory data showed an unexpected drop in petrol supplies. Earlier, the February crude contract gained more than $1 to a session high at $60.85.

On the economic front, sales of existing US homes fell 1.7 per cent in November to an annual rate of 6.97 million units as inventories climbed, a trade group said, while an index of Midwest business activity, also released on Thursday, was higher than expected.

The stock of Home Depot Inc., the world's biggest home improvement retailer, declined 0.5 per cent to $40.91 and was among the biggest drags on the Dow. Luxury home builder Toll Brothers Inc. slid 0.9 per cent to $35.50.

Separate reports showed first-time claims for jobless pay rose last week while the number of help-wanted ads in US newspapers increased modestly in November.

On the Nasdaq, shares that were strong performers over the course of the year are down -- a sign that investors could be taking profits before 2005 draws to a close, according to traders like Kevin Kruszenski at McDonald Investments Inc.

Shares of Apple Computer Inc. fell 1.9 per cent to $72.19 while Google slipped 0.8 per cent to $423.07.

- REUTERS