U.S. stocks were set to open flat on Wednesday as data showing higher-than-expected private-sector job losses in July sparked caution about the strength of the economic recovery.

According to the ADP Employer Services report, U.S. private employers shed 371,000 jobs in July, compared with a revised 463,000 drop in June, but above the estimated 345,000 by economists polled by Reuters.

The figures come two days ahead of the release of the government's all-important non-farm payrolls report for July, where investors will look for more definitive signs of an economic turnaround.

It is, of course, worse than expected, but the number is well off its highs, indicating modest improvement in the labor market, said Dan Greenhaus, analyst at Miller Tabak & Co in New York.

I think the initial market reaction to this will be negative, but the relationship between the ADP number and the payroll number is suspect at best.

S&P 500 futures fell 1.20 points and were slightly above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures lost 18 points, and Nasdaq 100 futures slipped 3 points.

The Institute for Supply Management is scheduled to release its July report on the services sector at 10 a.m. (1400 GMT). According to a Reuters poll of economists, the ISM non-manufacturing index is forecast to rise to 48.0 from 47.0 the month before.

Also at 10 a.m. (1400 GMT), the U.S. Commerce Department releases June factory orders. Economists in a Reuters survey expect a fall of 1.0 percent month over month compared with a 1.2 percent rise in May.

Procter & Gamble
posted a stronger-than-expected quarterly profit, but its shares slipped 3.2 percent to $53.70 before the bell as investors fretted about the company's sales and forecast.

In Tuesday's trading Wall Street extended gains in choppy trading, lifting the benchmark S&P 500 index <.SPX> to a fresh nine-month closing high. The tech-heavy Nasdaq scored its highest close since early October.

The S&P 500 is now up 48.7 percent since hitting a 12-year low on March 9.

(Additional reporting by Ryan Vlastelica; Editing by Padraic Cassidy)