US STOCKS-Wall St drops on economic fears

* Investors wary ahead of European bank repayments to ECB

* Consumer confidence falls in June on job woes

* Dow off 2.5 pct, S&P down 2.9 pct, Nasdaq off 3.3 pct

* For up-to-the-minute market news see [STXNEWS/US] (Updates to late afternoon, changes byline)

By Chuck Mikolajczak

NEW YORK, June 29 (Reuters) - U.S. stocks slid on Tuesday after concerns resurfaced over euro-zone fiscal woes ahead of massive bank repayments to the European Central Bank and a steep drop in consumer confidence unnerved investors.

The S&P 500 briefly tumbled near its 2010 intraday low of 1,040.78, which analysts said could ignite further declines. The index is on track to close at its lowest level since November and on track to break its closing low for the year at 1,050.47 -- another bearish signal for markets.

"This is very interesting now. This is a real critical point. If you can't hold 1,040 at this time of the day, you are set up for a pretty ugly close," said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

The equity sell-off was widespread in a run of selling that began in Asia overnight and then expanded into Europe. Economically sensitive sectors such as materials, industrials and financials were among the hardest-hit sectors.

Boeing Co (BA.N) slid 6 percent to $63.29 and Caterpillar Inc (CAT.N) shed 5.1 percent to $61.14. Diversified manufacturer 3M Co (MMM.N), which raised its second-quarter sales outlook last night, was not immune to the selling pressure, dipping 0.2 percent to $78.80. For details, see [ID:nN2895865]

Fears about the strength of the banking system surfaced again, with investors worried about a potential liquidity shortfall of more than 100 billion euros in the financial system as European banks repay 442 billion euros ($545.5 billion) in emergency loans on Thursday. [ID:nLDE65S0M0]

U.S. consumer confidence dropped sharply in June, after rising for three months, on worries about the labor market, according to a report from the Conference Board. The news heightened fears of an economic slowdown after recent spate of weak data from the housing and job markets. [ID:nN29138077]

"People ran back in their holes as soon as there was a problem. That's not a good sign. They are not out, they are not spending again -- the velocity of money is not going anywhere," Saluzzi added.

The Dow Jones industrial average .DJI dropped 254.31 points, or 2.51 percent, to 9,884.21. The Standard & Poor's 500 Index .SPX fell 31.38 points, or 2.92 percent, to 1,043.19. The Nasdaq Composite Index .IXIC lost 74.24 points, or 3.34 percent, to 2,146.48.

The KBW bank index .BKX tumbled 4.1 percent.

The three main U.S. stock indexes were already in a weak technical position after their daily moving average convergence divergence, or MACD, a widely followed momentum indicator, generated a "sell" signal, as it pointed to more negative short term momentum.

Earlier in the day, the Conference Board corrected its leading economic index for China to an April gain of 0.3 percent from a previously reported rise of 1.7 percent, a sharp revision that undermined confidence in China's ability to sustain strong growth. [ID:nN29126233]

The correction prompted investors to turn against riskier assets, adding to a global sell-off. The Shanghai Composite Index fell 4.3 percent to end at a 14-month low.

U.S. crude oil futures CLc1 dropped 3 percent, or $2.31, to settle at $75.94 a barrel.

The euro hit a lifetime low against the Swiss franc and an 8 1/2-year low against the yen. [ID:nLDE65S213]

Moving in tandem with stocks, the euro has become a barometer for risk aversion. The 25-day rolling correlation between the euro and the S&P 500 rose to 0.63 on Tuesday.

The CBOE volatility index .VIX, known as Wall Street's fear gauge, surged nearly 20 percent to a session high of 34.69, its highest level since early June. (Reporting by Chuck Mikolajczak; Editing by Jan Paschal)