(Corrects to show Banco Bilbao Vizcaya Argentaria is Spanish,
not Argentine, in paragraph 12; adds background to paragraph 13)
* S&P 500 on track for second straight weekly decline
* Procter & Gamble leads the Dow's gainers after results
* Dow down 1.2 pct, S&P 500 off 1.3 pct, Nasdaq off 1.5 pct
By Chuck Mikolajczak
NEW YORK, Jan 24 U.S. stocks fell on Friday, on
the heels of a selloff in emerging market assets, hurt by growth
concerns in China and as expectations grew that the Federal
Reserve will trim its market-friendly stimulus measures further.
A rout in emerging market assets spread to developed
countries in Europe on worries about Fed policy, slowing growth
in China and political problems in Turkey, Argentina and
Friday's slide put the S&P 500 on track for its worst drop
since Nov. 7, pushing the index down 1.8 percent for the week.
The benchmark index fell below its 50-day moving average for the
first time since Dec. 18, a technical support level that could
indicate more selling pressure if convincingly pierced.
"The big question, the one that everybody is trying to get
their brain around is: 'Is this the correction that is the
buying opportunity or are we setting up for something a little
bit different?'" said Gordon Charlop, managing director at
Rosenblatt Securities in New York.
"You had to figure, at some point, the multiples were
expanding to a spot where we were going to not see the same kind
of growth we saw last year in terms of equity returns."
Among the 10 major S&P 500 sectors, the industrials index
fared the worst, down 2.3 percent as General Electric
Co lost 2.7 percent to $25.13 and Boeing Co fell
2.9 percent to $137.23.
The Dow Jones industrial average fell 194.36 points or
1.2 percent, to 16,002.99. The S&P 500 lost 23.3 points
or 1.27 percent, to 1,805.16. The Nasdaq Composite
dropped 61.745 points or 1.46 percent, to 4,157.13.
But in a signal that the selling may be overextended,
investors were willing to pay more for protection against a drop
in the S&P 500 today than three months down the road. The last
time the spread between the CBOE volatility index and
three-month VIX futures turned negative was in mid-
October, shortly after a 4.8 percent pullback in the S&P 500
opened the door to the last leg of the 2013 market rally.
With many market participants expecting the Fed to decide
next week to shave its stimulus by another $10 billion a month,
investors will look to less risky assets such as U.S. bonds on
expectations that interest rates will begin to rise.
The Fed's policymakers will conclude a two-day
meeting on Wednesday.
Worries over China's growth surfaced after a disappointing
manufacturing number spurred the S&P 500 to a 0.9 percent drop
The Turkish lira hit a record low and the South
African rand fell to five-year low against the dollar.
U.S.-listed shares of Banco Bilbao Vizcaya Argentaria, S.A.
tumbled 3.9 percent to $12.19.
Shares of the Spanish bank, with heavy exposure to Latin
America, fell a day after Argentina's peso currency marked its
steepest daily decline in 12 years, prompting Argentina's
government to loosen strict foreign-exchange controls.
Argentina's government said on Friday it would relax
stringent foreign-exchange controls, after it abandoned its
long-standing policy of intervening to support the peso
currency. That resulted in the currency's steepest plunge since
the 2002 financial crisis.
Going against the day's downdraft was Procter & Gamble Co
, which advanced 2.7 percent to $80.37 and led the Dow's
gainers. The stock jumped after the world's largest household
products maker reported lower quarterly profit, but kept its
2014 sales forecast unchanged.
Microsoft Corp shares rose 2.6 percent to $36.98
and gave the biggest boost to the S&P 500 after the world's
largest software company posted a bigger-than-expected quarterly
Honeywell International Inc reported
higher-than-expected fourth-quarter profit and revenue on
Friday, as sales grew across the diversified manufacturer's
major segments. But its stock gave up its earlier gain and
slipped 0.4 percent to $89.48 at midday.
Thomson Reuters data through Friday morning showed earnings
for the fourth quarter are expected to grow 7.5 percent. Of the
122 companies in the benchmark S&P 500 index that have reported
results so far, 63.9 percent beat expectations, slightly above
the long-term average of 63 percent.
(Editing by Bernadette Baum, Nick Zieminski and Jan Paschal)