* Dollar Tree offers to buy Family Dollar for $9.2 bln
* June pending home sales unexpectedly fall
* S&P 500 about 1 percent from intraday record
* Indexes down: Dow 0.4 pct, S&P 0.5 pct, Nasdaq 0.7 pct
(Updates to market open, adds economic data)
By Ryan Vlastelica
NEW YORK, July 28 U.S. stocks fell on Monday as
weak data on the housing market and services sector were the
latest indications of worsening economic conditions, taking the
S&P 500 below a key support level.
While acquisition activity limited the market's decline,
keeping indexes near record levels, investors found few reasons
to buy as the data followed some high-profile disappointments in
corporate earnings, including from Amazon.com and
Caterpillar last week.
Pending home sales unexpectedly fell 1.1 percent in June.
The report follows a drop of 8.1 percent in June new home sales,
the biggest slump in almost a year. The PHLX housing sector
index fell 1.6 percent. D.R. Horton Inc fell 1.7
percent to $21.24.
Activity in the U.S. services sector was at its most brisk
in 4-1/2 years in July, though readings for new business and
employment growth weakened, according to financial data firm
Markit's preliminary data.
"This isn't the first soft data point we've gotten on
housing recently, which suggests the sector is decelerating, a
real discouragement," said Liam Dalton, president of Axiom
Capital Management Inc in New York. "The data suggests it is
time to be cautious over the idea of a robust economy."
Later this week will see the release of data on
second-quarter gross domestic product, as well as the July
The Dow Jones industrial average fell 65.63 points or
0.39 percent, to 16,894.94, the S&P 500 lost 9.24 points
or 0.47 percent, to 1,969.1 and the Nasdaq Composite
dropped 31.14 points or 0.7 percent, to 4,418.42.
With the day's move, the S&P 500 fell below its 14-day
moving average, a level that had served as support on Friday.
The benchmark index remains about 1 percent away from an
all-time record reached last week.
In the latest deal news, Dollar Tree Inc offered to
buy Family Dollar Stores Inc for about $9.2 billion
while Zillow Inc agreed to buy Trulia Inc for
$3.5 billion in stock.
Family Dollar jumped 22 percent to $77.73 as the S&P's
biggest percentage gainer while Dollar Tree was up 2.8 percent
to $55.72. Trulia jumped 8 percent to $60.86 while Zillow fell
6.7 percent to $148.26.
Cummins Inc raised its full-year revenue outlook,
citing improved North American demand; still, shares fell 3
percent to $145.69.
Cisco Systems Inc dipped 1 percent to $25.7.3 a day
after Pacific Crest downgraded the stock to "sector perform"
El Pollo Loco Holdings Inc, a restaurant chain that
went public on Friday, extended the rally of its trading debut,
jumping 20 percent to $28.81.
(Editing by Bernadette Baum)