NEW YORK (AP) — The stock market managed a modest gain Friday as investors seemed to shake off the latest round of downbeat economic news.

The bad news came from several corners including insurer American International Group Inc., which reported a larger than expected fourth-quarter loss. The company said its primary insurance business was hurt in part by the economy.

The National Association of Realtors said sales of previously occupied homes fell 7.2 percent in January. It marks the second straight month of a big drop. Analysts had predicted a gain. The Realtors’ report comes two days after the Commerce Department said that new home sales fell last month.

Meanwhile, the Commerce Department reported that the nation’s economy grew at a faster pace than initially estimated for the end of 2009. The stronger growth from the third quarter to the fourth quarter was welcome news but analysts say much of the gain is tied to businesses rebuilding inventories. Growth is expected to slow in the coming quarters.

The government said gross domestic product grew at an annual rate of 5.9 percent, above the 5.7 percent previous estimate.

The fifth straight monthly increase in the Chicago Purchasing Managers Index provided some hope about the strength of manufacturing. The Chicago PMI rose to 62.6 in February from 61.5 in January.

At the same time, the report from AIG brought a reminder of the strains that still exist in the financial system. AIG said it lost $8.87 billion in the fourth quarter of 2009. That’s improved from a year earlier but weaker than analysts expected. The stock fell more than 7 percent.

The mixed reports did little to add to investors’ understanding of the economy. Major stock indexes have been strong this month but logged modest moves since the start of the year because there is disagreement over the pace of recovery. This week stocks have fallen, jumped and slid again as worries about the economy intensified and eased. Still, stocks indexes likely will end February with gains of more than 2 percent.

In late morning trading, the Dow Jones industrial average rose 10.96, or 0.1 percent, to 10,331.99. The broader Standard & Poor’s 500 index rose 0.95, or 0.1 percent, to 1,103.88, and the Nasdaq composite index slipped 0.27, or less than 0.1 percent, to 2,233.95.

Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.63 percent from 3.64 percent late Thursday.

The dollar slipped against other major currencies, while gold prices fell.

Crude oil rose $1.46 to $79.63 per barrel on the New York Mercantile Exchange.

Trading volume could be lighter Friday in part because of a winter storm hitting the Northeast. Delayed or canceled buses, trains and flights will make it harder for some traders to get to work.

Not all the news was downbeat. Private equity firm Thomas H. Lee Partners said it would acquire the parent of Carl’s Jr. and Hardee’s restaurants. The offer for CKE Restaurants Inc. totals $619 million in cash and $309 million in debt. Analysts like to see takeovers because it is a sign of confidence in the economy. CKE rose $2.24, or 25.1 percent, to $11.15.

AIG fell $2.11, or 7.7 percent, to $25.40.

Advancing stocks narrowly outpaced those that fell on the New York Stock Exchange, where trading volume came to 274.8 million shares compared with 318.3 million shares traded at the same point Thursday.

The Russell 2000 index of smaller companies fell 2.10, or 0.3 percent, to 628.36.

Overseas, markets rose after improved economic reports in Britain and Japan boosted optimism about a global recovery. The U.K. government revised higher its estimate of the nation’s economic growth in the fourth quarter of 2009. In Japan, output from factories rose by more than expected in January and February retail sales jumped.

In afternoon trading, Britain’s FTSE 100 rose 1.3 percent, Germany’s DAX index gained 1.1 percent, and France’s CAC-40 rose 1.4 percent. Earlier, Japan’s Nikkei stock average rose 0.2 percent.

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