Stock markets mixed as trading year nears end, illustration photo/ Source: freepik.com

The Dow eked out a fresh record, while the S&P 500 fell a bit short of an all-time high despite finishing the day modestly higher.

"The last two months have been truly spectacular," said Steve Sosnick of Interactive Brokers. "No institutional investor can afford to be under-invested."

US equities have trended higher since late October as the market has embraced moderating inflation and a strong labor market in the belief the US economy can avoid recession.

Data from the Department of Labor on Thursday showed a slight increase in US unemployment claims. However, the level remains low by historic standards.

"My concern right now is that both stocks and bonds have been rallying so aggressively, we really have to think about the scenarios that would allow this to continue," said Sosnick, who noted that bond market predictions of six interest rate cuts in 2024 implies a weaker economy.

Elsewhere, Asian equities mostly closed higher while European stock markets finished in the red.

Global stock markets have mostly been on the front foot since the Federal Reserve's most recent meeting strengthened expectations that it would soon cut interest rates.

"Indices have been powered higher, partly by optimism about a soft landing for the US and there is still a risk of the economy slowing more sharply as the full effect of higher borrowing costs filter through," said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

On the commodities front, oil prices dropped as more major shipping companies resume transit through the Red Sea following efforts by a US-led naval coalition to police the maritime route against Yemeni rebel attacks.

US oil prices fell more than three percent despite a weekly inventory report that showed lower stocks of crude oil and gasoline.

- Key figures around 1645 GMT -

New York - Dow: UP 0.1 percent at 37,710.10 (close)

New York - S&P 500: UP less than 0.1 percent at 4,783.35 (close)

New York - Nasdaq: FLAT at 15,095.14 (close)

London - FTSE 100: FLAT at 7,722.74 (close)

Paris - CAC 40: DOWN 0.5 percent at 7,535.16 (close)

Frankfurt - DAX: DOWN 0.2 percent at 16,701.55 (close)

EURO STOXX 50: DOWN 0.3 percent at 4,514.38 (close)

Hong Kong - Hang Seng Index: UP 2.5 percent at 17,043.53 (close)

Tokyo - Nikkei 225: DOWN 0.4 percent at 33,539.62 (close)

Shanghai - Composite: UP 1.4 percent at 2,954.70 (close)

Euro/dollar: DOWN at $1.1066 from $1.1105 on Wednesday

Dollar/yen: DOWN at 141.41 yen from 141.83 yen

Pound/dollar: DOWN at $1.2728 from $1.2798

Euro/pound: UP at 86.92 pence from 86.77 pence

West Texas Intermediate: DOWN 3.2 percent at $71.77 per barrel

Brent North Sea Crude: DOWN 1.6 percent at $78.39 per barrel