Dow fails to stay above 12,000 (UPDATED)

Wall Street's blue chip measure, the Dow Jones Industrial Average, rose above 12,000 for the first time in almost three years but in a volatile session fell short of the mark.

At the close (10am NZ time), the Dow was up 7.87 points to 11,985.06 after having spent much of the day above 12,000, which it last achieved in June 2008. Leading on the upside was Dupont, up 2.6%, while Boeing fell after disappointing earnings from Boeing.

The Dow made its first pass at 12,000 in 2006, as credit expansion fuelled a home-buying binge that eventually ended in the 2007-08 housing bust. From a peak of 14,198.10 in October 2007, the market tumbled to a March 2009 low of 6469.95, wiping out more than half of the blue-chip index's market capitalisation.

The broader market did better than the blue chips. The Nasdaq Composite gained 0.6% to 2739.50, while the S&P 500 index rose 0.4%, to 1296.66, putting it on the cusp of 1300, a level it last held in August 2008.

Other markets: Europe, Asia up
Stocks rallied across Europe, fuelled by higher car sales. The Stoxx Europe 600 index closed up 0.9% to 282.47, bouncing back from a 0.7% drop in the previous session.

In Frankfurt, the DAX gained 1% to 7121.35, led higher after Porsche said its vehicle sales in China rose 63% on the year. In Paris, the CAC 40 closed 0.7% higher at 4049.07 while in London, the FTSE 100 closed up 0.9% at 5969.21.

Most major Asian markets rose, with Korean shares climbing on news of faster-than-expected economic growth last quarter, while Chinese stocks were led higher by a rise in resource companies.

Japanese stocks declined as news of another major vehicle recall hit shares of Toyota Motor. The Shanghai Composite rose 1.2% to 2708.81, Korea's Kospi added 1.1% to 2110.46 and Hong Kong's Hang Seng Index edged up 0.2% to 23,843.24, its first gain in five sessions.

Singapore's Straits Times Index gained 1.2% to 3220.78. The benchmark indexes in Thailand and Indonesia each rose 2%. Japan's Nikkei Stock Average, however, fell 0.6% to 10,401.90 and India’s Sensex continued to drop, down 0.9% to 18,969.45.

Commodities: Oil up, gold down
Crude futures were nearly flat, handing back gains after a surprise increase in US stockpiles.

The rise of 4.8 million barrels last week was much larger than the 900,000-barrel build analysts had been expecting and marked a reversal in the string of declines through December.

Light, sweet crude for March delivery traded 4USc lower at $US86.15 a barrel in New York, after trading as high as $US86.99. Brent crude on the ICE futures exchange traded $US1.33 higher at $US96.58 a barrel.

Gold futures declined as a surprisingly large jump in new US home sales boosted stocks and the economic recovery.

The most-actively traded gold contract, for February delivery, was down $US6.90, or 0.5%, at $US1325.40 an ounce in New York.

Currencies: Dollar down, pound up
The dollar touched a two-week low against the Swiss franc as the greenback remains out of favour with traders. It fell as low as 0.9400 franc, its lowest level since January 4.

The dollar was at 0.9425 franc from 0.9422 franc late on Tuesday. The euro remained just below $1.37 and was at $US1.3684 in New York trading, from $1.3682. It had risen to $US1.3723 earlier in the day, which was its highest level since November 22.

The dollar was at ¥82.26, from ¥82.25, while the euro was at ¥112.62 from ¥112.53. The UK pound clawed back some of its previous day's losses against the dollar and euro. It was at $US1.5878 from $US1.5820.

The euro was at £0.8614 after hitting an 11-week high earlier, down from £0.8649.