Stocks on Thursday pulled back from a sharp rally the day before, when markets reacted to a liquidity move by the world's major central banks, while the euro gained for a fourth day.
The move by the banks to offer cheap dollar loans for struggling European banks helped to soothe worries about a global financial crisis.
Libor, the rate at which banks borrow from one another, fell for the first time since July 22 in response to the actions of central banks the previous day.
The euro rose against the dollar, bolstered by generally successful Spanish and French debt auctions. The euro was last up 0.3 percent at $1.34811.
European equities ended lower after a choppy trading session, while U.S. stocks edged down.
The Dow Jones industrial average was down 35.49 points, or 0.29 percent, at 12,010.19. The Standard & Poor's 500 Index was down 3.90 points, or 0.31 percent, at 1,243.06. The Nasdaq Composite Index was up 1.29 points, or 0.05 percent, at 2,621.63.
Today's action is just a reaction to yesterday, which was such an impressive move that I'd feel pretty good if we just held close to even, said Mark Foster, who helps manage $500 million at Kirr Marbach & Co in Columbus, Indiana.
On Wednesday, the Dow had its best day since March 2009.
U.S. stocks are expected to end next year with modest gains, but the range of predictions varies widely due to the uncertainty surrounding the euro zone debt crisis.
The Standard & Poor's 500 index is expected to rise about 7.5 percent from Wednesday's close to 1,340 by the end of next year, according to a median forecast from over 40 respondents polled over the last week.
The MSCI world equity index was up 0.3 percent on Thursday, well off the day's highs.
A report showing the pace of growth in the U.S. manufacturing sector picked up in November to its strongest level since June did little to push stocks higher.
Overseas, Spain sold 3.75 billion euros of debt in three maturities at the top of the targeted range, although its cost of borrowing was the highest in 14 years and at levels seen as unsustainable for public finances. France also found demand for its sale of 4.35 billion euros of debt in several maturities.
Headlines out of Europe have caused much volatility in markets in recent months, with the region's debt crisis fuelling worries the problems could escalate into a global financial crisis.
U.S. government debt prices fell, with benchmark yields touching their highest level in nearly a month. Ten-year Treasury notes were down 4/32 in price, with the yield at 2.09 percent.
In the oil market, Brent crude was down as Goldman Sachs warned of a possible sharp drop in demand on increasing signs of economic slowdown in Europe. Brent crude fell $1.85 to $108.67 a barrel.
Gold prices were nearly flat after earlier rising to their highest in two weeks as the central banks' move gave investors confidence to cut their holdings of cash.
Gold was trading at $1,745.54 an ounce by 3:44 p.m. British time, having risen to a session peak of $1,754 earlier,
(Reporting by Caroline Valetkevitch; Additional reporting by Gertrude Chavez-Dreyfuss and Ryan Vlastelica; Editing by Andrea Ricci)