US stocks put together a moderate advance in light post-holiday trading after the finance arm of General Motors got a government lifeline, but dreary holiday spending readings dimmed the chance of a big year-end rally.

Americans spent much less on gifts this season than they did last year, according to SpendingPulse, a division of MasterCard Advisors. Retail sales dropped between 5.5 per cent and 8 per cent compared with last year, the data showed.

Investors had some good news on Christmas Eve, when the Federal Reserve allowed GMAC Financial Services, the finance arm of the struggling Detroit automaker General Motors, to become a bank holding company and thus qualify for the US Government’s $700 billion rescue fund. Analysts had said that without financial help, GMAC might have had to file for bankruptcy protection or shut down.

The Dow Jones industrial average rose 47.07 points, or 0.56 per cent, to close at 8,515.55. Broader stock indicators also rose. The Standard & Poor’s 500 index rose 4.65, or 0.54 per cent, to 872.80, and the Nasdaq composite index rose 5.34, or 0.35 per cent, to 1,530.24.

In Tokyo, Japanese share prices rose to a six-week high. The benchmark Nikkei 225 index gained 140.02 points or 1.63 per cent to close at 8,739.52.

Markets in Europe were closed for Boxing Day.

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