At the open: Stocks flat amid conflicting economic signals

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North American stock markets opened mixed and near unchanged, as conflicting economic signs and worries about the looming U.S. fiscal cliff created an unsettling backdrop for investors.

Just past 10 a.m. (ET), the S&P/TSX index was down 9 points at 12,230; the S&P 500 was up about 1 point at 1,417; and the Dow Jones industrial average was down 2 points at 13,023.

A number of manufacturing reports have been revealed today and the results have been rather mixed.

Perhaps most uplifting were the manufacturing readings out of China, where an official state measure reached 50.6, a seven-month high, while a separate rally by HSBC hit a 13-month high, at 50.5.

Markit's euro zone manufacturing Purchasing Managers index rose to 46.2 in November from 45.4. While an improvement, it was the 16th straight time it came in below 50, the point that separates expansion from contraction.

In the U.S., the Institute for Supply Management index came in at 49.5, signifying contraction and well below the 51.4 that economists had expected. But a separate report showed U.S. construction spending rose 1.4 per cent in October to a three-year high, beating expectations for a rise of 0.5 per cent.

Meanwhile, much of the market's attention remains centered on the fiscal cliff. Over the weekend, interviews on the Sunday morning talk shows with both Republicans and Democrats further illustrated the divide between the parties on how to avert the more than $600-billion (U.S.) in spending cuts and tax increases set to take hold Jan. 1. Many economists expect the U.S. economy to fall back into recession without an agreement.

Republican speaker of the House of Representatives John Boehner said "we're nowhere" in the negotiations so far, and ridiculed the initial White House proposal tabled late week that seeks $1.6-trillion (U.S.) in new tax revenue. That's twice as much as what Republicans say is acceptable and Mr. Boehner said "there's clearly a chance" that the U.S. won't have an agreement in time.

Still, traders assume that a lot of the talk on the fiscal cliff may be political bluster, and even if a fiscal cliff deal is not reached, there could be ways to delay some of the spending cuts or tax increases until further into the new year.

Here's a look at some of the stocks moving on early news:

Saputo shares are up 2.3 per cent after the company announced it will acquire Morningstar Foods from Dean Foods for $1.45-billion.

Research In Motion is down 1.6 per cent after Canaccord downgraded the BlackBerry maker to "sell" and reiterated a $10 price target.

Dell shares are up 7 per cent after Goldman Sachs upgraded it to "buy" from "sell" and raised its price target to $13 (U.S.) from $9.

Ford is up 2 per cent after it reported U.S. November sales were up 6.5 per cent, and small car sales hit a 12-year high.

Canadian Pacific Railway said it will take a $180-million non-cash charge as it shunts aside plans to extend its network into a coal-producing region on the western U.S. CP shares are down 0.1 per cent.

Yahoo shares are down 2 per cent after a civil court in Mexico entered a preliminary $2.7-billion (U.S.) judgment against the Internet giant for breach of contract involving a yellow pages listings service.