* ADP report a tick below expectations, Dec. revised lower
* Services sector grows at faster clip than forecast
* Gilead Sciences shares weigh the most on S&P 500
* Indexes down: Dow 0.3 pct, S&P 0.6 pct, Nasdaq 1.2 pct
By Rodrigo Campos
NEW YORK, Feb 5 U.S. stocks fell on Wednesday
after mixed data gave investors few reasons to return to the
market in what could be the middle of a long-awaited correction.
U.S. data is being closely watched after a weak reading in
the factory sector on Monday sent Wall Street into a tailspin
and triggered a global equity selloff.
At its session low, the S&P 500 was 6 percent below its Jan.
15 record high, and technicians are looking at the 1,730/1,740
area - the mid September high and Monday's low - for support.
"We are now at critical support at 1,740 so they are going
to try to defend that," said Paul Mendelsohn, chief investment
strategist at Windham Financial Services in Charlotte, Vermont.
"It will be a buying opportunity when investors feel
comfortable this rout we're in is over," he said.
"I don't think they want to step in front of it just yet
until they have a feeling of where the bottom is going to be.
We're not there yet."
The Dow Jones industrial average fell 44.44 points or
0.29 percent, to 15,400.8, the S&P 500 lost 11.02 points
or 0.63 percent, to 1,744.18 and the Nasdaq Composite
dropped 46.696 points or 1.16 percent, to 3,984.824.
Investors are not ready to call the bottom and are paying
more for protection against further slides. The CBOE Volatility
Index rose 5.5 percent to trade above 20 for a
The vast U.S. services sector rebounded in January after two
months of slower growth and firms added workers at the fastest
clip in more than three years, according to the Institute for
Supply Management. Separate data showed the U.S. private sector
created 175,000 jobs in January, slightly below estimates, while
the December reading was revised lower.
The limp data earlier in the week added to concerns about
growth in China and the outlook for some emerging market
economies. A recent rout in emerging currencies spurred some
central banks to act, pressuring bond and stock holdings and
luring investors into assets perceived as relatively safe, like
the yen and U.S. and German government debt.
"There's fear as we move into Friday's (jobs) report that
we're going to see a weather impact that is going to distort the
number and make if difficult to know if it is covering up
something more substantial," said Mendelsohn.
EARNINGS TRICKLE IN
According to Thomson Reuters data through Wednesday morning,
of the 298 companies in the S&P 500 that have reported earnings,
69.5 percent have topped Wall Street expectations, above the 63
percent beat rate since 1994 and the 67 percent rate for the
past four quarters.
Gilead Sciences fell 5.4 percent to $77.60 and was
the heaviest weight on the S&P 500 a day after quarterly
Shares of Cognizant Technology Solutions fell 6.9
percent to $90.36. The IT services provider forecast
slower-than-expected revenue growth.
Merck shares rose 1.7 percent to $54.43 on
enthusiasm for newly announced cancer-drug partnerships with
rival U.S. companies, even as the Dow component's sales and
profit just missed analysts' estimates.
Tableau Software shares jumped 15.9 percent to
$92.02 after the data analysis software maker forecast
better-than-expected revenue for this quarter and results
handily beat analysts' estimates.
CVS Caremark Corp said it would stop selling tobacco
products at its 7,600 stores by October, becoming the first U.S.
drugstore chain to take cigarettes off the shelf. Its shares
fell 1.6 percent to $65.06.