* Strong ADP report raises hopes for payrolls
* Minutes show Fed wanted cautious tapering approach
* Micron Tech helps lift Nasdaq after earnings
* Dow off 0.4 pct, S&P off 0.02 pct, Nasdaq up 0.3 pct
By Chuck Mikolajczak
NEW YORK, Jan 8 The S&P 500 finished nearly flat
on Wednesday as equity indexes had a muted reaction to the
minutes from the U.S. Federal Reserve's most recent meeting,
while Micron's strong results helped buoy the Nasdaq.
Minutes of the Fed's Dec. 17-18 meeting, after which the
U.S. central bank announced its decision to begin trimming its
monthly bond purchases, showed Fed officials were careful to
tread lightly as they embarked on the tapering process.
The Fed's accommodative policies were the main driver of the
S&P 500's rally of nearly 30 percent in 2013. The program is
expected to keep a floor under stock prices for as long as it
"The financial markets really didn't move at all, but
typically history would suggest they need a little bit of time
to just digest these things," said Darrell Cronk, regional chief
investment officer of Wells Fargo Private Bank in New York.
"What we need to recognize is since December 18, we've seen
a significant improvement in the economic data. If we get a
200,000 or north jobs report on Friday, it increases the
likelihood, along with that improving data, the Fed continues
its tapering process at the January meeting."
Earlier in the session, a report by ADP, a payrolls
processor, showed U.S. private-sector employers added 238,000
jobs in December, more than expected and the best read since
November 2012, while November 2013 numbers were revised higher.
The Dow Jones industrial average fell 68.20 points or
0.41 percent, to end at 16,462.74. The S&P 500 dipped
just 0.39 of a point, or 0.02 percent, to finish at 1,837.49.
The Nasdaq Composite rose 12.43 points or 0.30 percent,
to close at 4,165.611.
The S&P 500 has fallen 0.6 percent over the first five
sessions of the year. According to the January effect watched by
some market participants, the first month dictates the stock
market's fortunes for the year - and the first five trading days
are important in determining the outcome.
However, Credit Suisse data shows that any month, except
October, could be used to determine the market's momentum 11
months ahead more than 50 percent of the time.
Micron Technology shares soared 9.9 percent to close
at $23.87 and helped bolster the Nasdaq a day after the
chipmaker reported higher-than-expected quarterly profits.
Microsoft shares slid 1.8 percent to $35.76,
pressuring the Dow. Microsoft is closer to naming a new chief
executive officer, according to a source familiar with the
board's thinking, but it lost a front-runner candidate on
Tuesday when Ford's CEO Alan Mulally said he would not be
going to the software giant.
Ford's stock rose 1 percent to end at $15.54.
Shares of JC Penney Co Inc plunged 10 percent to
close at $7.37 after the department store chain said on
Wednesday that it was "pleased" with its holiday season sales
without giving specific results. That prompted many on Wall
Street to say the retailer's sales may have declined last month.
Apollo Education Group Inc shares jumped 14.2
percent to $30.76 after the owner of the University of Phoenix
reported a quarterly profit well ahead of Wall Street
The pharmaceutical sector remained a hotbed for mergers and
acquisitions. Forest Laboratories agreed to buy
privately held specialty pharmaceutical company Aptalis Holdings
Inc for about $2.9 billion. Forest Labs' stock surged 17.9
percent to $69.30 and ranked as the S&P 500's biggest gainer.
NuPathe Inc leaped 35.6 percent to $4.38 after the
company said it received a buyout offer from Israel's Teva
Pharmaceutical Industries Ltd for $114 million
plus milestone payments related to NuPathe's migraine treatment.
Teva's U.S.-listed shares shed 0.4 percent to $41.05.
Volume was modest, with about 6.05 billion shares traded on
U.S. exchanges, slightly below the 6.19 billion average so far
this month, according to data from BATS Global Markets.
Declining stocks outnumbered advancing ones on the New York
Stock Exchange by a ratio of 17 to 13, while on the Nasdaq, 13
stocks fell for every 12 that rose.