World stocks were little changed on Tuesday as weak U.S. housing data poured cold water on a four-day Wall Street rally while the euro was stuck near an 11-month low on concerns about a large Italian debt auction later in the week.
U.S. crude oil prices rose $1 to more than $100 a barrel on fears of supply disruptions, but trading volumes were thin as traders returned to their desks for the shortened week between the Christmas and New Year holidays.
U.S. stocks opened lower after a report showed U.S. single-family home prices fell more than expected in October in a reminder of the challenges facing the housing market.
The data weighed on the U.S. equity market, which had rallied on positive economic data during the past four sessions -- enough to turn the S&P 500 index positive for the year.
There's not enough of a surprise in the number to get people to put on a risk on trade, said Paul Radeke, vice president at the Minneapolis-based KDV Wealth Management, referring to the home price data. Especially when there's a lack of participation in the market.
Stocks edged higher later, but trading was slow.
The Dow Jones industrial average <.DJI> rose 23.27 points, or 0.19 percent, to 12,317.27, while the Standard & Poor's 500 Index <.SPX> gained 2.96 points, or 0.23 percent, at 1,268.29. The Nasdaq Composite Index <.IXIC> was up 5.73 points, or 0.22 percent, at 2,624.37.
In Europe, the FTSEurofirst 300 <.FTEU3> index of top shares was up 0.1 percent. Stock markets in Britain, Hong Kong and Australia remained closed.
The MSCI All-Country World index <.MIWD00000PUS> edged higher 0.16 percent but remained 9.1 percent lower for the year.
The euro traded at $1.3061, little changed on the day and near an 11-month low of $1.2945 -- a level touched earlier in the month.
The single European currency could suffer more selling if Italy struggles to raise money at this week's year-end debt auction. The country intends to sell 8.5 billion euros in three- and 10-year bonds on Thursday.
I think there could be some downside risks for the euro. (Thursday's auction) will be more of a test of the market, given that the bonds auctioned are longer maturities, said Sverre Holbek, currency strategist at Danske in Copenhagen.
A further rise in Italian yields should almost certainly be euro negative, and thin liquidity may exacerbate the move.
Italian 10-year borrowing costs were little changed at 7.02 percent, a level viewed as unsustainable in the long-run for a country facing a national debt of around 120 percent of GDP. It faces around 150 billion euros of debt refinancing in February-April alone.
U.S. crude oil prices were 87 cents higher at $100.55 a barrel as Iran threatened to shut oil shipping in the Strait of Hormuz if foreign sanctions on Tehran's oil sales are imposed.
U.S. crude oil futures and gold have been among the top-performing assets in 2011, with year-to-date rises of about 9 percent and 12 percent, respectively.
Gold prices hovered around $1,600 an ounce, however, as investors stayed on the sidelines in the final week of the year.
(Reporting by Walter Brandimarte; Editing by Kenneth Barry)