* ADP employment report comes in below expectations
* U.S. defense secretary says North Korea a danger
* Indexes down: Dow 0.8 pct, S&P 1.1 pct, Nasdaq 1.1 pct
By Caroline Valetkevitch
NEW YORK, April 3 (Reuters) - U.S. stocks fell on Wednesday,
with the S&P 500 index posting its biggest daily decline in more
than a month, after a weaker-than-expected survey of private
employers raised concerns about the strength of the economy.
News the Pentagon was sending a missile defense system to
Guam in the coming weeks and remarks by Defense Secretary Chuck
Hagel that North Korea posed a "real and clear" danger added to
The ADP National Employment report on private-sector jobs
showed less-than-expected hiring in March, which was a worrying
sign for investors before the Labor Department's March non-farm
payrolls report on Friday.
Wednesday's market decline came a day after the benchmark
S&P 500 and the Dow finished at record highs. Energy and
financial sectors led the day's fall on the S&P 500, with the
S&P 500 financial index down 1.7 percent.
"With some weaker economic data, you're seeing some
risk-off action going on today. People are paring positions
across the board ahead of the jobs number Friday," said Michael
James, managing director of equity trading at Wedbush Securities
in Los Angeles.
Headlines on North Korea add "another risk element to the
market," he said.
Defense company shares gained despite the broader move
lower. Shares of Northrop Grumman were up 1.1 percent at
The Dow Jones industrial average was down 111.66
points, or 0.76 percent, at 14,550.35. The Standard & Poor's 500
Index fell 16.56 points, or 1.05 percent, at 1,553.69,
its biggest daily percentage decline since Feb. 25. The Nasdaq
Composite Index was down 36.26 points, or 1.11 percent,
The Dow Jones Transportation Average, seen as a
barometer of economic activity, fell 1.3 percent to 6005.95,
closing below its 50-day moving average for the first time since
The S&P 500, up 8.9 percent since the start of the year, has
come close to its intraday record level of 1,576.09 in the past
few sessions before pulling back, and analysts have pointed to
signs of its struggle.
On Tuesday, decliners beat advancers in the market despite
gains in the three major indexes. Also, defensive sectors like
healthcare, consumer staples and utilities, have led this year's
Among Wednesday's declining stocks, ConAgra Foods Inc
fell 1.9 percent to $34.85 after reporting third-quarter
earnings that fell 57 percent, though revenue grew.
Monsanto Co rose 0.8 percent to $104.51 after raising
its full-year profit forecast.
The ADP report showed U.S. companies hired at the slowest
pace in five months, far below what economists had expected,
though the February report was revised upward.
The ADP report comes ahead of the more widely watched
Department of Labor report Friday. That report
is expected to show 200,000 jobs were created last month.
In another report, the Institute for Supply Management's
March services sector index also came in below expectations,
with the pace of growth at the lowest level in seven months.
Volume was roughly 7.1 billion shares traded on the New York
Stock Exchange, the Nasdaq and the NYSE MKT, compared with the
2012 average daily closing volume of about 6.45 billion.
Decliners outpaced advancers on the NYSE by about 4 to 1 and
on the Nasdaq by nearly 3 to 1.