* U.S. ISM services index slightly above forecasts
* Euro zone's major economies in decline -surveys
* Dow off 0.1 pct, S&P 500 and Nasdaq flat
By Chuck Mikolajczak
NEW YORK, June 5 U.S. stocks treaded water on
Tuesday as investor angst about the euro zone's fiscal crisis
offset data showing the U.S. economy's services sector grew
slightly faster than expected in May.
The pace of growth in the U.S. services sector picked up in
May as a gauge of new orders improved, according to an industry
report released on Tuesday. The Institute for Supply
Management's services index edged up to 53.7 in May from 53.5 in
April, a touch above economists' forecast for it to hold steady.
The ISM data was a welcome change from recent economic
reports, which coupled with concerns about the euro zone, drove
the S&P 500 down more than 6 percent for May.
"The non-manufacturing ISM number was certainly a welcome
bit of good news in that it beat expectations and shows the
service side of the economy is still expanding," said Bucky
Hellwig, senior vice president at BB&T Wealth Management in
"It's an event-driven, data-driven market right now so while
there is always a focus on the data points, because of the
situation we are in, there is an inordinate amount of attention
being paid to them."
Concerns about an escalation of the euro zone's debt crisis
kept a weight on the market, however, and served to cap gains.
Spain's Treasury Minister Cristobal Montoro said the
nation's high borrowing costs mean it is effectively shut out of
the bond market and the European Union should help Madrid
recapitalize its debt-laden banks.
Statements on the outcome of emergency talks among the Group
of Seven industrialized nations as they tackle the euro zone's
deepening crisis offered little clarity to investors. The
Treasury Department said G7 finance ministers "reviewed
developments in the global economy and financial markets and the
policy response under consideration."
Japan's finance minister said he told G7 members that Japan
is confident in Europe's response to its problems, but indicated
Tokyo was prepared to intervene in order to curb its currency.
The Dow Jones industrial average dropped 14.30
points, or 0.12 percent, to 12,087.16. The Standard & Poor's 500
Index inched up just 0.02 of a point, or unchanged on a
percentage basis, at 1,278.20. The Nasdaq Composite Index
was unchanged at 2,760.01.
In the euro zone, most major economies are now in various
states of decline, according to business surveys that suggested
even Germany is no longer immune to the crisis.
The S&P financial sector index rose 1.3 percent,
leading gains among the 10 major S&P 500 sectors. The financial
sector index, however, is down more than 12 percent since the
start of May.
Shares of JPMorgan Chase & Co rose 3.3 percent to
$32.01, while Bank of America Corp added 2.6 percent to
$7.08 and Citigroup advanced 3 percent to $25.56.
On the downside, Dollar General Corp shares dropped
3.1 percent to $46.99 after the company said key shareholders
plan to sell up to 25 million shares.