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Q. How can I exclude selected packages when I rum yum update command under CentOS Linux server?

A. Yum uses a configuration file at /etc/yum/yum.conf or /etc/yum.conf. You need to place exclude directive to define list of packages to exclude from updates or installs. This should be a space separated list. Shell globs using wildcards * and ?) are allowed.
How do I exclude php and kernel packages when I use "yum update"?

Open /etc/yum.conf file:
# vi /etc/yum.conf
Append following line under [main] section, enter:
exclude=php* kernel*
At the end, it should look like as follows:

[main]
cachedir=/var/cache/yum
keepcache=0
debuglevel=2
logfile=/var/log/yum.log
distroverpkg=redhat-release
tolerant=1
exactarch=1
obsoletes=1
gpgcheck=1
plugins=1
exclude=php* kernel*

# Note: yum-RHN-plugin doesn't honor this.
metadata_expire=1h

# Default.
# installonly_limit = 3

# PUT YOUR REPOS HERE OR IN separate files named file.repo
# in /etc/yum.repos.d

yum --exclude command line option

Finally, you can skip yum command updates on command line itself using following syntax:
# yum --exclude=package* update
# yum --exclude=php* update
# yum --exclude=kernel* update

Reference: http://www.cyberciti.biz/faq/redhat-centos-linux-yum-update-exclude-packages/