Meanwhile on the economic front, the consumer confidence index tumbled to 65.1 in December from a downwardly revised 71.5 in November, hitting a four-month low, according to the Conference Board.
Earlier, jobless claims fell 12,000 to a seasonally adjusted 350,000 last week. Meanwhile, the four-week moving average tumbled to its lowest since March 2008.
And new home sales rose 4.4 percent in November to a seasonally adjusted 377,000-unit annual rate, the fasts pace in 2-1/2 years, according to the Commerce Department.
Marvell Technology declined after a federal grand jury ruled the chipmaker infringed two patents held by Carnegie Mellon University and ordered the company to pay $1.17 billion in damages. In addition, at least two brokerages lowered their rating on the company.
Toyota Motor said it plans to settle a U.S. class-action lawsuit for $1.1 billion.
Domino's Pizza climbed after Oppenheimer raised its price target on the pizza chain to $50 from $44.
Hartford Financial Services edged higher after Stifel added the financial services company to its "select" list and raised its target price to $28 from $25.
BCD Semiconductor skyrocketed nearly 90 percent after the chipmaker agreed to be bought by Diodes in a deal worth $151 million.
In Europe, stocks rose in cautious trading after being closed for Christmas and Boxing Day. Meanwhile, in Asia, Japanese stocks hit a 21-month high as a weaker yen boosted export stocks. Sentiment in Asia was boosted as profits at China's factories jumped in November, helped by the recovery in the economy.