* Dow, S&P 500 coming off worst month since Jan 2014
* Exxon earnings fall less than expected
* ISM manufacturing index misses forecasts
* Indexes: Dow down 0.1 pct, S&P up 0.01 pct, Nasdaq down 0.3 pct (Updates to late afternoon)
By Caroline Valetkevitch
NEW YORK, Feb 2 (Reuters) - U.S. stocks were nearly flat in a volatile session on Monday as disappointing readings on consumer spending and the manufacturing sector were offset by gains in energy shares.
While the data pointed to weakening economic conditions, major indexes are coming off their worst monthly performance in a year, leading many traders to seek out bargains in beaten-down sectors.
The S&P 500 moved between positive and negative territory repeatedly, but the S&P 500 energy sector was up 1 percent. Crude oil was last up 2 percent despite a strike at U.S. refineries that could boost crude supply.
Shares of Exxon Mobil were up 1 percent after it reported a smaller-than-expected profit drop. The results follow several disappointing earnings results from many multinational companies.
“Fundamentals still look strong but earnings are really coming in under expectations, which is creating a general concern that is leading to heavy volatility,” said James Liu, global market strategist for JPMorgan Funds in Chicago. “We got used to good earnings growth and data and now we’re facing the first real test of that sentiment not always being true.”
The Dow Jones industrial average fell 23.86 points, or 0.14 percent, to 17,141.09, the S&P 500 gained 0.18 points, or 0.01 percent, to 1,995.17 and the Nasdaq Composite dropped 14.82 points, or 0.32 percent, to 4,620.42.
The day’s swings continue the recent pattern of volatility. The S&P fell more than 1 percent in three of the past four sessions and market swings have gotten larger. Over the past 14 days, the S&P has moved an average of 30 points between its session high and low. On January 9, that average was under 20.
On the economic front, the pace of growth in the U.S. manufacturing sector slowed more than expected in January. U.S. consumer spending recorded its biggest decline since late 2009 in December, with cheaper gas not translating to higher activity.
Solar power companies were among the strongest of the day after China said it aims to install 15 gigawatts of solar power capacity this year, 43 percent more than it added in 2014. First Solar climbed 6.1 percent to $44.89, while Canadian Solar rose 4 percent to $21.21. (Additional reporting by Ryan Vlastelica; Editing by Nick Zieminski)