* Worries over fiscal cliff keep investors cautious
* Initial jobless claims fell sharply last week
* Best Buy surges on report its founder to make buy offer
* S&P off 0.06 pct, Dow up 0.02 pct, Nasdaq off 0.08 pct
By Leah Schnurr
NEW YORK, Dec 13 U.S. stocks opened little
changed on Thursday after data showed first time claims for
jobless benefits fell sharply last week, but investors were
cautious about making aggressive bets in the midst of ongoing
"fiscal cliff" negotiations.
Shares of Best Buy Co surged almost 18 percent after
a report that the company's founder is expected to make a fully
financed offer to buy the consumer electronics retailer by the
end of the week. Best Buy was up 17.9 percent at $14.36, making
it the biggest gainer on the S&P 500.
Other economic data on Thursday showed retail sales rose in
November after an October decline, brightening the picture for
Still, equities gains were constrained as the set of tax
hikes and spending cuts that are set to come into effect in the
new year remained at the forefront of investors' minds.
Negotiators on Wednesday warned the showdown over reaching a
deal on the so-called fiscal cliff could drag on past Christmas.
"With the suggestion that they're not any closer than they
were a few days ago, we're really just in a market that's trying
to figure out what the next catalyst might be," said Kate Warne,
investment strategist at Edward Jones in St Louis.
"I think we need to see either an actual plan or signs that
they've worked out a way to be sure they don't end up
disagreeing at the last minute. Either of those would be
positive, but so far we're not seeing anything that suggests
The Federal Reserve on Wednesday announced a fresh bout of
stimulus for the U.S. economy, but markets focused on comments
from Chairman Ben Bernanke, who reiterated that monetary policy
would not be enough to offset going over the fiscal cliff.
Investors are worried that doing so could send the economy
back into recession, though most expect a deal will be struck
The Dow Jones industrial average inched up 2.11
points, or 0.02 percent, at 13,247.56. The Standard & Poor's 500
Index edged down 0.56 point, or 0.04 percent, at
1,427.92. The Nasdaq Composite Index eased 2.51 points,
or 0.08 percent, to 3,011.31.
If the S&P 500 ends the session lower, it would break a
six-day winning streak. Some of those days saw only slight gains
on lower volume.
In the European Union, finance ministers reached a deal to
make the European Central Bank the bloc's top banking
supervisor. The move could boost confidence in leaders' ability
to tackle the region's sovereign debt crisis.
Initial claims for state unemployment benefits dropped
29,000 to a seasonally adjusted 343,000, pointing to healing in
the labor market.
Separate reports released at the same time showed producer
prices fell more than expected in November, while retail sales
rebounded though not by as much as expected.
CVS Caremark Corp gained 3.4 percent to $49.16 after
it said it expects higher earnings next year.