The Dow and the S&P 500 inched lower on Thursday as optimism about Bank of America's plan to repay $45 billion of government bailout money was offset by data showing the vast U.S. services sector contracted in November, which increased concerns about the recovery's strength.

But the Nasdaq rose modestly, drawing some support from Comcast Corp , up 6.5 percent at $15.91 after the company struck a deal to buy a majority stake in NBC Universal from General Electric Co . The transaction, once closed, will create a media superpower. GE shares climbed 1.2 percent to $16.27 on the New York Stock Exchange.

Bank of America made a surprising announcement late on Wednesday in a what is viewed as a victory for departing Chief Executive Kenneth Lewis that could free the lender from restrictions on pay as it looks to hire a new CEO.

It's good that Bank of America is going to be able to pay it back and get the government off of its back, said Charles Lieberman,

chief investment officer of Advisors Capital Management, LLC in Paramus, New Jersey.

Shares of Bank of America Corp , parent of the largest bank ranked by assets, rose 2.3 percent to $16.01.

The services sector index fell to 48.7, indicating that this hugelarge component of the U.S. economy had experienced contraction last month, according to a report from the Institute for Supply Management.

The Dow Jones industrial average <.DJI> dipped 5.14 points, or 0.05 percent, to 10,447.54. The Standard & Poor's 500 Index <.SPX> inched down just 0.52 of a point, or 0.05 percent, at 1,108.72. But the Nasdaq Composite Index <.IXIC> rose 6.78 points, or 0.31 percent, to 2,191.80.

The ISM data dented sentiment a day before November's unemployment figures are released in an even more influential economic report.

Shares of energy, manufacturing and natural resource companies were among the top drags. The S&P materials index <.GSPM> shed 0.4 percent, while the S&P energy index <.GSPE> slid 0.5 percent as U.S. crude oil futures slipped.

With the stock market up more than 60 percent from the lows of early March, tolerance for disappointing data has worn thin as investors seek justification for the lofty valuations. The benchmark S&P 500 index is up about 63 percent from its March 9 closing low.

Other data on Thursday showed that the number of U.S. workers filing new claims for unemployment fell last week, according to a government report, while third-quarter productivity was slightly less robust than previously thought, a third report said.

U.S. retailers posted much weaker-than-expected sales for November in a slow kickoff to the holiday shopping season.

The Retail HOLDRs ETF fell 0.7 percent.

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