Market flat as traders weigh bargains

NEW YORK (Reuters) - Stocks were little changed on Thursday, as traders were tempted by attractively low share valuations but still skittish on signs of further weakening in the economy.

Major indexes gyrated between positive and negative territory repeatedly. They opened the day lower after jobless claims data came in higher than expected and Cisco Systems warned late on Wednesday of slowing orders from Europe and the United States.

But falling prices and merger and acquisitions talk drew buyers, helping the Nasdaq, Dow and S&P all gain more than 1 percent for a brief period.

"There are value investors calling a bottom here," said Tim Ghriskey, chief investment officer of Solaris Asset Management in Bedford Hills, New York. "There are lots of bargain hunters in retail and financials."

The Dow Jones industrial average <.DJI> was up 4.88 points, or 0.04 percent, at 12,204.98. The Standard & Poor's 500 Index <.SPX> was up 4.92 points, or 0.37 percent, at 1,331.37. The Nasdaq Composite Index <.IXIC> was up 7.13 points, or 0.31 percent, at 2,285.88.

Cisco shares fell 0.4 percent to $23.01 after the network equipment maker gave a weak outlook and warned of a rapid slowdown in U.S. and European orders.

Wal-Mart Stores and Target Corp were among a slew of retailers reporting disappointing January sales, but the shares of both big-box chains were trading higher.

Shares of Children's Place Retail Stores Inc shot higher after the former chief executive of the kids apparel chain said he was confident he could make a bid to buy the company.

Wal-Mart stock climbed 1 percent to $49.30 and Target shares jumped 5.5 percent to $53.85. Children's Place shares were up 19 percent to $21.06.

Several possible mergers and acquisitions have come to the fore in recent days. The airline industry got a boost after The Wall Street Journal reported a merger of Delta and Northwest could be announced as early as next week.

In addition, preliminary talks between United Airlines' parent, UAL Corp , and Continental have grown more serious, a source familiar with the matter said.

Delta rose 0.8 percent to $18.10 and UAL was up 1 percent to $38.03. Continental gained 4.8 percent to $30.15 while Northwest slipped 0.2 percent to $18.45.

(Reporting by Jennifer Coogan; Editing by Leslie Adler)

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