* ISM Services tops expectations, but new orders slip
* Michael Kors climbs after earnings
* GT Advanced jumps on deal with Apple
* Indexes off: Dow 0.56 pct, S&P 0.52 pct, Nasdaq 0.45 pct
By Chuck Mikolajczak
NEW YORK, Nov 5 (Reuters) - U.S. stocks fell on Tuesday, as investors took profit following two days of gains, ahead of data later in the week they hoped would give a clearer indication of the strength of the U.S. economy.
The Institute for Supply Management said Tuesday its services index rose a point to 55.4 in October despite the impact of the partial government shutdown, above expectations for a reading of 54.0 versus 54.4 in September, although new order growth slowed for a second month to 56.8. The market initially drifted to a session low after the data was released, but recouped much of that drop later.
Investors will pay close attention to economic reports this week to gauge the strength of the economy; these include readings on gross domestic product and payrolls that were delayed by the government shutdown.
"Ideally you want very slow growth, the market really likes that and the concern is that the market gets ahead of it," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
"The market is already pricing in expectations of economic improvement and there certainly is a fear of some type of melt-up in the market and the market becoming somewhat of a bubble, but we are nowhere near that yet."
The Federal Reserve has indicated it will not begin to pare its monthly bond-buying program of $85 billion in long-term assets until the economy shows signs of improvement, a theme supported by three central bankers on Monday.
The Fed's stimulus has helped buoy the economy and the equity market for much of the year. The S&P 500 has gained 23.3 percent so far in 2013, and the Dow is up 18.7 percent.
The Dow Jones industrial average fell 87.34 points or 0.56 percent, to 15,551.78, the S&P 500 lost 9.17 points, or 0.52 percent, to 1,758.76 and the Nasdaq Composite dropped 17.753 points, or 0.45 percent, to 3,918.838.
Michael Kors Holdings Ltd gained 5 percent to $78.50 after the luxury apparel retailer reported a better-than-expected 40 percent jump in quarterly revenue.
GT Advanced Technologies jumped 21.4 percent to $10.17 after the company said Apple Inc will open a manufacturing facility in Arizona in partnership with the mineral crystal specialist to make sapphire materials for Apple's electronic devices.
CVS Caremark Corp advanced 2.4 percent to $63.47 after the drugstore operator and pharmacy benefits manager posted a higher-than-expected quarterly profit and raised its forecast for the year.
Mosaic Co lost 1.3 percent to $46.14 after the fertilizer company reported sharply lower third-quarter earnings.
Tenet Healthcare Corp was the worst performer on the S&P 500, down 9.6 percent to $43.62 after its third-quarter net income slid from a year earlier.
According to Thomson Reuters data, of 404 companies in the S&P 500 that have reported results through Tuesday morning, 69.6 percent have topped Wall Street's expectations, above the long-term average of 63 percent. However, just 53.3 percent have topped revenue forecasts, below the 61 percent average since 2002.