U.S. stocks closed mixed Thursday on economic data and a rebound in bond yields.

Business activity in the U.S. service sector expanded at a faster-than-expected pace in June, said the Institute for Supply Management, a research group.

The group said its index of business activity in the non-manufacturing sector registered 60.7, the highest point since April 2006.

The reading for June was higher than the 59.7 rate registered in May and the 58.1 clip expected by analysts.

However, as bond prices fell, the 10-year Treasury note's yield rose to 5.14 percent Thursday from 5.04 percent Tuesday.

Also on Thursday, General Motors Corp., one of the blue-chip index's 30 components, was downgraded by Bear Stearns after the company posted a 21.3 percent drop in June sales compared to last year.

The Dow Jones average declined 11.46, or 0.08 percent, to 13,565.84. The Standard &Poor's 500 index rose 0.54, or 0.04 percentat 1,525.41, while the Nasdaq composite index rose 11.70, or 0.44 percent, to 2,656.65.