US stocks closed little changed on Monday as concerns about subprime mortgage exposure haunted financial shares even as central banks pumped fresh cash into the global financial system.

Signs that tight credit markets may curb mergers and acquisitions capped stock prices after private equity firm Kohlberg Kravis Roberts & Co. said weak debt market conditions could hurt its profits.

In economic news, the Commerce Department said retail sales rose 0.3 per cent last month after falling 0.7 percent in June. The sales rebound was lead by back to school sales. Consumer spending fuels two-thirds of the American economy.

And a separate commerce department report found business inventories rose 0.4 per cent as expected in June. The number could mean businesses expect increasing demand, though it could also be the result of weaker than expected sales