Strong US data fails to move stocks

Stocks on Wall Street lost their grip on early gains, despite better-than-expected reports on jobs, factories and housing.

Weekly initial jobless claims fell below 400,000 for the first time since July 2008, while the closely watched Chicago Business Barometer reached its highest level in 22 years.

Pending sales of existing homes rose 3.5% in November to the highest level in seven months.

Stocks posted small declines as investors moved to lock in gains from a strong year that sent the market to two-year highs.

At the close (10am NZ time), the Dow Jones Industrial Average was down 15.67 points, or 0.1%, to 11,569.71, a day after reaching its highest close since August 28, 2008.

The Nasdaq Composite was down 0.15% to 2662.98, as was the S&P 500 to 1257.88.

Other markets: Europe down, Asia up
European stock markets declined on the last full trading day of the year. The Stoxx Europe 600 index ended down 1.3% to 277.02, trimming the year's gains to 9.1%.

The FTSE 100 index shed 0.4% to 5971.01, curbing gains for the year to 10%. London markets will open for a half-day on Friday and won't reopen until Tuesday.

In Germany, the DAX 30 index fell 1.2% to 6914.19 in a shortened final session of the year, putting the year's jump at 16%.

In Paris, where the main bourse will trade for a half-session on Friday and reopen on Monday, the CAC 40 index fell 1% to 3850.76.

Most Asian stock markets rose, with resource sector shares leading the advance in Shanghai and Sydney, while banks rose in Hong Kong.

The Shanghai Composite gained 0.3% to 2759.58 and Australia's S&P/ASX 200 rose 0.3% to 4790.38. Hong Kong's Hang Seng Index edged up 0.1% to 22,999.34, India's Sensex added 0.7% to 20,389.07 and Korea's Kospi rose 0.4% to 2051, ending at a three-year high.

Japan's Nikkei Stock Average declined 1.1% to 10,228.92, as shares of exporters fell.

Commodities: Oil, gold down
Crude-oil prices fell below $US90 a barrel as US inventories fell less than expected.

The light, sweet crude-oil futures contract for February delivery was down $US1.76, or 1.9%, at $US89.36 a barrel in New York, tumbling below $US90 for the first time since December 22.

Brent crude on the ICE futures exchange fell $US1.54 to $US92.60 a barrel.

Gold futures eased as an improving US employment picture outweighed a slightly weaker dollar.

The most actively traded gold contract, for February delivery, was down 0.3%, or $US4.80, at $US1408.70 an ounce in New York.

Currencies: Dollar down, euro up
A US dollar rally against the yen fizzled though the greenback remained well off session lows. The dollar had rallied sharply following upbeat economic readings but was unable to sustain early momentum.

The dollar was at ¥81.59 compared with ¥81.63 late on Wednesday. The dollar started the day by falling to a low of Y81.28. The euro rose to Y108.55 from ¥107.60.

The euro rose to $US1.3295 and briefly climbed above $US1.3300, after closing on Wednesday at $US1.3220. The UK pound was at $US1.5428, down from $US1.5497.