Initial jobless claims dropped more than expected last week but investors remained cautious as the European financial crisis weighed on corporate earnings. The markets closed mixed with the Dow slipping 9 points to 12,707 while Nasdaq rose 11 points to 2859.

On the upside

Patriot Coal (NYSE: PCX) fell to a fourth quarter loss as coal demand weekend. Investors welcomed news that the coal producer will idle its Big Mountain thermal coal complex.

Shares of Amylin Pharmaceuticals (Nasdaq: AMLN) continued climbing after the Food and Drug Administration approved the company's once-a-week diabetes treatment Bydureon on Friday.

Six affiliates of Alpha Natural Resources (NYSE: ANR) in West Virginia won the Mountaineer Guardian safety award for 2011.

On the downside

Fitch Ratings withdrew its rating on China Medical Technologies (NYSE: CMED) after the company failed to make a payment on a scheduled coupon.

Bank of America downgraded AK Steel (NYSE: AKS) to an Underperform rating citing increased pension expenses.

ShoreTel (Nasdaq: SHOR) will acquire M5 Networks in a cash and stock deal valued at approximately $146.3 million.

In the broad market, advancing issues outpaced decliners by a margin of more than 9 to 7 on the NYSE and by nearly 5 to 3 on Nasdaq. The Russell 2000 which tracks small cap stocks rose 3 points to 812.