US stocks lost ground after opening higher Monday, as investors held their breath for a raft of major economic events this week, including the Federal Reserve' s minutes and December nonfarm payroll report.
The Dow Jones Industrial Average lost 44.89 points, or 0.27 percent, to 16,425.10. The S&P 500 extended its losses to a third straight session, dipping 4.60 points, or 0.25 percent, to 1,826. 77. The Nasdaq Composite Index shed 18.22 points, or 0.44 percent, to 4,113.68.
The three major stock indices opened higher to start the first full trading week in 2014 but pared morning gains after data showed the U.S. service sector expanded at a slower pace.
The Non-Manufacturing Index, which measures activity in the U.S. service sector, declined to 53 percent in December from 53.9 percent in November, the Institute for Supply Management said Monday.
New orders for U.S. manufactured goods rose in November to a record level, mainly fueled by increasing new orders for durable goods, the Commerce Department said.
Investors may use any sign of weakness in incoming data as an opportunity to sell and lock in profits after the U.S. equity market in 2013 posted its best year in more than a decade and is overdue for a mild correction, according to some analysts.
The Fed will release on Wednesday the minutes of its December policy meeting, when the central bank announced the first tapering of its massive asset purchases by 10 billion U.S. dollars starting in January. The minutes will give investors a better understanding of the Fed's policy.
Meanwhile, a non-farm payroll report for the final month of 2013 will be released Friday by the Labor Department. Analysts expected non-farm payroll employment to increase 200,000 last December, while jobless rate could remain unchanged at 7 percent.
Furthermore, the fourth-quarter earnings season will unofficially kick off this week with results from aluminum giant Alcoa due out on Thursday.
FactSet, a financial information provider, estimated earnings growth rate for the S&P 500 as a whole for the fourth quarter at 6. 3 percent, while the revenue growth rate is forecast to reach 0.3 percent.
Last week, the three major stock indices finished lower, with the S&P 500 starting the new year with a two-day losing streak for the first time since 2005.