) -- Stocks finished with a whimper Wednesday on disappointing economic data, weak earnings reports and a slide in commodity prices.


Dow Jones Industrial Average

fell 85 points, or 0.7%, to settle at 12,723. The

S&P 500

tumbled 9 points, or 0.7%, to 1347 and the

Nasdaq Composite

off by 13 points, or 0.5%, at 2828.

A poor read on the employment picture stoked the selling pressure on equities.

Companies added 179,000 jobs in April, according to Automatic Data Processing's employment change report. The level was lower than the growth of 200,000 that economists had been expecting, and also below March's upwardly revised level of 207,000 jobs.

In addition, activity within the services sector weakened in April as the Institute for Supply Management's non-manufacturing index fell to a reading of 52.8, from March's level of 57.3. Economists had been expecting a stronger reading of 57.4 for April, according to

"Market participants probably don't like those ADP numbers and today's M&A news didn't offset the ADP data as much as a bullish investor might have hoped," said Mike McGervey, president of McGervey Wealth Management.


ConAgra Foods

(CAG) - Get Report

offered to buy

Ralcorp Holdings


for $86 a share, or $4.9 billion in cash, which exceeds the $82 a share cash-and-stock proposal that

ConAgra made for the branded food products company in March. Ralcorp's stock gained 4.9% to close at $87.39, while ConAgra's stock rose 3.1% to $25.51.

Applied Materials

(AMAT) - Get Report

agreed to buy

Varian Semiconductor


for $63 a share in cash, or $4.9 billion.

The per-share price represents a 55% premium to Varian's closing price on Tuesday. Shares of Varian soared 51.3% to $61.36, while shares of Applied Materials fell 1% to $15.09.

The ADP report, which measures job growth in the private sector, is widely considered an early indicator of the government's monthly non-farm payroll report. On Friday, the market expects the U.S. Labor Department to report job growth of 185,000 in April, which is down from March's increase of 216,000.

McGervey, whose expectations for Friday's report are in line with Wall Street's forecasts, said, "It does look like the trend in our job market will continue to put downward pressure on unemployment and provide for reasonable growth in the labor force growth but, unfortunately, it won't be parabolic."

McGervey also said higher gas prices could be responsible for some recent "sputtering economic growth."

"The declining dollar has pushed a lot of commodity prices very high over the last couple of weeks," he said. "We are seeing some topping out in the metals markets as well as in the oil market, but it's too early to tell whether these trends will continue."

The energy sector was the session's worst-performer as oil prices dropped to levels unseen in recent weeks. The June crude oil contract lost $1.81 to settle at $109.24 a barrel.

The Energy Information Administration said crude oil supplies rose by 3.4 million barrels in the week ended April 29, which was well above the build of 1.7 million barrels that economists had been expecting, according to a Platts survey.

Late Tuesday, the American Petroleum Institute reported an increase of 3.2 million barrels to crude stocks.

Elsewhere in commodity markets, the June gold contract fell $25.10 to settle at $1,515.30 an ounce and the July silver contract lost $3.20 to close at $39.39 an ounce.

"It might sound like the tail wagging the dog, but it's hard to imagine silver falling and gold not joining in," said Adrian Ash, head of research at

The technology sector traded sideways during a session that saw 75% of the 1.09 billion shares trading on the New York Stock Exchange lose ground, while only 23% of stocks rose. On the Nasdaq, 2.15 billion shares were traded.


(DD) - Get Report



(IBM) - Get Report

were among the Dow's biggest laggards alongside

General Electric

(GE) - Get Report



(CAT) - Get Report

, while


(MSFT) - Get Report


Procter & Gamble

(PG) - Get Report



(HPQ) - Get Report



(INTC) - Get Report

were among the top performers, as Intel debuted the world's first 3-D transistor for chips that it believes will revolutionize computer, mobile phone and electronics performance.

On the earnings front,


(K) - Get Report

missed analysts' first-quarter profit estimates by 4 cents with earnings of $1 a share. The cereal maker blamed higher input costs for the shortfall. The stock lost 1.2% at $56.75.

Shares of

Las Vegas Sands

(LVS) - Get Report

were down 7.3% at $42.53 after the

casino operator missed Wall Street's expectations for the first quarter late Tuesday.

Time Warner


saw its stock fall 3.3% to $36.49 after the

media company posted a year-over-year decline of 11% in net income during the first quarter, although its adjusted earnings beat expectations.

Hong Kong's Hang Seng lost 1.4%. Markets in Japan were closed for a public holiday. The FTSE in London was declined 1.6%, and the DAX in Frankfurt lost 1.7%.

The benchmark 10-year Treasury rose 8/32, diluting the yield to 3.223%. The dollar weakened against a basket of currencies with the dollar index trading sideways.


--Written by Melinda Peer and Andrea Tse in New York