Wall Street little changed after jobs data; Fed minutes due

By Rodrigo Campos

NEW YORK (Reuters) - U.S. stocks were little changed in early trading on Wednesday, a day after the S&P 500 posted its largest gain in three weeks and after a report showed private sector payrolls rose the most in 13 months.

Most Dow components were trading lower, with declines in IBM , Procter & Gamble and McDonald's weighing the most on the price-weighted index.

U.S. private 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 December number was just shy of the highest estimate in a Reuters poll of economists.

 

"ADP's number is consistent with other labor numbers we have gotten," said Guy Berger, U.S. economist at RBS Securities in Stamford, Connecticut.

"It is conceivable that by the end of year, we could see the unemployment rate fall below 6.5 percent," he said. "That would be consistent with the (Federal Reserve's) projected pace of tapering this year."

Minutes of the Fed's December meeting, at which the U.S. central bank announced its decision to begin trimming its stimulative monthly bond purchases, are out later on Wednesday. Market participants will scan the minutes for signs of a clear Fed commitment to keeping rates low for a long time.

The Dow Jones industrial average fell 73.08 points or 0.44 percent, to 16,457.86, the S&P 500 lost 2.26 points or 0.12 percent, to 1,835.62 and the Nasdaq Composite added 3.972 points or 0.1 percent, to 4,157.153.

Micron Technology shares jumped 11.3 percent to $24.20 a day after it reported a much higher than expected quarterly profit.

Microsoft is closer to naming a new chief executive, according to a source familiar with the board's thinking, but it lost a front-runner candidate Tuesday when Ford's chief, Alan Mulally, said he would not be going to the software giant. Microsoft shares fell 1.6 percent to $35.83.

A deadly blast of arctic air shattered decades-old temperature records as it enveloped the eastern United States on Tuesday, snarling air, road and rail travel, driving energy prices higher and overwhelming shelters for homeless people. Economic activity is also expected to be hurt beyond airlines and other transport companies.

"Coming off the Christmas season you have a lot of sales but the weather hasn't collaborated," said Andre Bakhos, managing director at Janlyn Capital in Bernardsville, New Jersey.

The pharma sector continued to be fertile ground for merger and acquisition activity. Forest Laboratories agreed to buy privately held specialty pharmaceutical company Aptalis Holdings Inc for about $2.9 billion. Forest Labs shares rose 14.1 percent to $67.06.

NuPathe Inc shares jumped 35.6 percent to $4.38 after it said it received a buyout offer from Israel's Teva Pharmaceutical for $114 million plus milestone payments related to a migraine treatment.

The so-called January effect is in some market participants' minds. According to the market maxim, January dictates the year's fortunes - and the first five trading days are important in determining the outcome.

However, data from Credit Suisse show any month, except October, could be used to determine the market's momentum 11 months ahead more than 50 percent of the time.

(Additional reporting by Richard Leong; Editing by Bernadette Baum and Nick Zieminski)