NEW YORK (AP) – Stocks gave up brief gains Friday and traded mostly flat after a surprise jump in sales of existing homes last month lent strength to the growing notion that the housing sector may not be as weak as feared.

Existing home sales rose by the biggest amount in nearly three years in February amid a sharp increase in sales in the Northeast, the National Association of Realtors said. The 3.9 percent increase was the largest since a similar jump in March 2004.

Still, the report did have some downbeat aspects – the median price of a home fell year-over-year for the seventh straight month and inventories rose.

The Federal Reserve this week said an “adjustment” in the housing sector was continuing, offering some relief for investors left unnerved by the woes among so-called subprime mortgage lenders. Wall Street had grown concerned that an implosion among subprime lenders, which make loans to people with poor credit, could spill over into other parts of the economy and derail already slowing economic growth.

In midmorning trading, the Dow Jones industrial average, rose 8.57, or 0.07 percent, to 12,469.71.

Broader stock indicators turned mixed. The Standard & Poor’s 500 index rose 0.32, or 0.02 percent, to 1,434.86, and the Nasdaq composite index fell 2.27, or 0.09 percent, to 2,449.47.

Bonds fell, with the yield on the benchmark 10-year Treasury note rising to 4.57 percent from 4.58 percent late Thursday. The dollar was mixed against other major currencies, while gold prices fell.

Light, sweet crude rose 67 cents to $62.36 on the New York Mercantile Exchange. Oil prices rose following word that Iranian naval vessels had seized 15 British sailors in Iraqi waters.

In corporate news, Amgen Inc. fell $2.69, or 4.4 percent, to $57.78 after the company halted a trial of colon cancer drug Vectibix after the product hastened the development of colon cancer when used in combination with Avastin.

DaimlerChrysler AG drew investors’ attention amid reports the automaker would sell its Chrysler unit. DaimlerChrysler rose $3.69, or 4.8 percent, to $81.29.

The Russell 2000 index of smaller companies rose 0.08, or 0.01 percent, to 808.13.

Overseas, Japan’s Nikkei stock average closed up 0.35 percent, Hong Kong’s Hang Seng index edged up 0.01 percent and the sometimes volatile Shanghai Composite Index advanced 0.10 percent, which closed at a record high for the third straight day. A nearly 9 percent drop in the Shanghai Composite Index on Feb. 27 helped kick off the global selloff.

In afternoon trading, Britain’s FTSE 100 rose 0.39 percent, Germany’s DAX index rose 0.19 percent, and France’s CAC-40 added 0.52 percent.

___

On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com