US stocks finished little changed on Wednesday after rallying sharply in the previous session, as encouraging results from auto makers helped offset fresh euro-zone liquidity concerns.

The Dow Jones Industrial Average rose 21.04 points, or 0.17%, to 12418.42. The slim gain came after the blue-chip Dow surged 179.82 points on the first US trading day of 2012, the third-biggest point gain to kick off a new year in the index's history.

The Standard & Poor's 500-stock index edged up 0.24 point, or 0.02%, to 1277.30. Consumer discretionary and material stocks rose, while health care and utilities fell. The technology-oriented Nasdaq Composite slipped 0.36 point, or 0.01%, to 2648.36.

Alcoa rose 22 cents, or 2.4%, to 9.45 and Microsoft gained 64 cents, or 2.4%, to 27.40 to pace the Dow's gains.

Verizon shed 52 cents, or 1.3%, to 39.21. The telecommunications company reported it sold 4.2m iPhones in the fourth quarter, a quarterly record for the wireless carrier.

Encouraging results from some auto makers helped lift investor spirits midway through the session. Ford Motor reported a 10% year-over-year increase in vehicle sales for December while General Motors reported a 4.6% gain. For all of 2011, Ford sales increased 11% and GM's rose 13%. Both auto makers see sales gains intensifying in 2012.

Ford shares rose 17 cents, or 1.5%, to 11.30. GM advanced 10 cents, or 0.5%, to 21.15.

On the economic front, US factory orders rose for the first time in three months in November on stronger demand for aircraft and other goods. Orders increased 1.8%, according to the Commerce Department. But economists had forecast a 2.1% jump.

Separately, TrimTabs Investment Research forecast that only 38,000 new jobs were added last month, well below the median forecast of 155,000 jobs that economists are expecting in Friday's nonfarm payrolls report.

In corporate news, Yahoo named Scott Thompson, the president of eBay's PayPal division, as its new chief executive. The appointment comes after the Internet company fired its previous CEO, Carol Bartz, in September. Interim CEO Tim Morse will resume his role as chief financial officer. Shares shed 50 cents, or 3.1%, to 15.78.

TiVo jumped 90 cents, or 10%, to 9.82, after AT&T agreed to pay the set-top box maker at least $215 million to settle litigation. AT&T also acquired rights to use TiVo's intellectual property.

Acme Packet fell 6.11, or 19%, to 25.70 after the networking company provided a fourth-quarter earnings and revenue outlook that fell well below analyst forecasts. Acme cited uncertainty in the North American service-provider market.

LCA-Vision surged 1.09, or 36%, to 4.17. The laser-vision-correction-services company said the number of procedures performed in the fourth quarter rose 30% over the same period a year earlier.

Life Partners Holdings slumped 1.10, or 17%, to 5.27. The insurer said a lawsuit had been filed against it and three top executives by the Securities and Exchange Commission, alleging disclosure and accounting fraud.

For Australian ADRs listed on the NYSE, BHP Billiton increased $4.13 (5.85%) to $74.76, ResMed rose 21 cents (0.83%) to $25.61, Telstra Corporation added 38 cents (2.23%) to $17.43, Telecom Corporation of NZ strengthened 15 cents (1.88%) to $8.14 and Westpac gained $2.88 (2.81%) to $105.28.

The US dollar regained ground, with the euro coming under renewed pressure as concerns about the euro-zone debt crisis re-emerged.

Treasury prices declined, pushing 10-year yields back toward 2%, as investors try to balance optimism based on economic data and worries about Spain's fiscal strains and Italian banks. At 7:45AM (AEST) the 10 year Treasury note was 1.98%, and the five year note was 0.88%.

European stocks dropped as renewed concerns about the euro-zone sovereign-debt crisis prompted investors to sell bank shares, particularly in Spain and Italy.

The Stoxx Europe 600 index fell 0.6% to end at 249.62.

Vestas Wind Systems A/S was the biggest loser in the Stoxx 600. Its shares sank more than 19% in Copenhagen after the wind-turbine maker said it expects 2011 adjusted earnings to be zero compared with a previous forecast of around EUR255 million.

Markets in Spain and Italy posted big losses.

In Madrid, the IBEX 35 index dropped 1.7% to 8,581.80, as a newspaper reportedly said that the Spanish government was mulling whether to apply for loans from the European Union's bailout fund and the International Monetary Fund to help restructure the nation's banks. The unconfirmed report cited unnamed sources.

Spanish banks fell sharply, with Banco Santander down 3.9% and BBVA SA down 2.9%.

In Milan, shares of UniCredit Spa sank 14.5% after the Italian bank said it would sell shares at a 43% discount to the so-called theoretical ex-rights market price. The fall in UniCredit shares weighed on Italy's FTSE MIB index, which dropped 2% to 15,327.03.

Other bank shares also posted steep declines across Europe. In Portugal, Banco Comercial Portugues dropped 12% and Banco Espirito Santo fell nearly 9%. The PSI 20 index closed down 1.9% at 5,592.76 in Lisbon.

In Germany, the DAX 30 index declined 0.9% to 6,111.55, led lower by a 5% drop for shares of Commerzbank AG.

France's CAC 40 index fell 1.6% to 3,193.65, as shares of nuclear energy firm Electricite de France SA dropped 5.1%.

In the telecommunications-equipment sector, Alcatel-Lucent fell 6.4% in Paris and Ericsson dropped 4.5%. The losses came after Acme Packet lowered its 2011 outlook for revenue and earnings.

The UK's FTSE 100 index fell 0.6% to end at 5,668.45, with commodities trader Glencore International closing down 3.1%. Shares of Next PLC dropped 3.1% after the retailer issued a cautious outlook for 2012, saying it expects "modest growth in overall Next brand sales with profit before tax only slightly up on this year."

On the FTSE 100, Rio Tinto advanced 200.00 pence (6.4%) to 3,299.30 pence and BHP Billiton increased 115.50 pence (6.15%) to 1,951.13 pence.

Asian stock markets closed mostly higher with Japanese stocks beginning their journey in 2012 on a positive note, as investors got their first chance to react to an upbeat start to global equity markets, while Chinese shares lost a struggle to advance amid lingering concerns about tight liquidity.

Japan's Nikkei Stock Average finished 1.2% higher at 8,560.11 and Taiwan's Taiex added 0.4% to 7,082.97. China's Shanghai Composite Index declined 1.4% to 2,169.39, after a higher opening. Hong Kong's Hang Seng Index fell 0.8% to 18,727.31, while South Korea's Kospi fell 0.5% to 1,866.22.

In Hong Kong, PetroChina climbed 1.2%, and Maanshan Iron & Steel added 5.5%. In Shanghai, Baoshan Iron & Steel added 0.2% and China Petroleum & Chemical rose 2.5%.

Those gains in Hong Kong were countered by a 14% tumble in shares of Swire Pacific.

Many Chinese banking and property shares also declined. Industrial & Commercial Bank of China Ltd. shed 1.1% and China Resources Land Ltd. gave up 2.4% in Hong Kong; on the mainland bourses, ICBC dropped 0.5% in Shanghai, while China Vanke shed 1.9% in Shenzhen.

In Tokyo, Japanese exporters and financials rode the upbeat data which had fueled a Wall Street advance to gains of their own.

Among the major climbers, Sony rose 1.6%, and Toyota improved by 3.1%.

Technology shares also rallied, with Renesas Electronics climbing 1.7%, and Fujitsu rising 3.5%.

The NZX-50 ended up 0.4% at 3288.11, helped by improving sentiment.

Base metals closed lower on the London Metal Exchange as returning investors cashed in on the previous session's gains. Oil prices spiked in mid-morning trading at their highest level in nearly eight months on reports that European Union officials agreed in principal to an embargo on Iranian oil imports, but fell back on an apparent lack of concrete details. Gold pushed into positive territory after reports about the oil embargo on Iran. Discussion continues over details such as timing and implementation, but the news sparked a sustained rise in gold.