* Spanish debt-insurance costs hits new high of 500 bps
* Banks lead drop: JPMorgan and Wells Fargo off over 2 pct
* S&P 500 on track for worst weekly percentage drop of 2012
* U.S. consumer sentiment slips in early April
* Dow off 0.6 pct, S&P down 0.8 pct, Nasdaq off 1.2 pct
By Ryan Vlastelica
NEW YORK, April 13 (Reuters) - U.S. stocks fell on Friday and were on track to end a second straight week lower as concerns about the pace of global growth sparked a selloff in financial shares.
Data showed that China’s economy expanded 8.1 percent in the first quarter, a rate that was slower than expected and the country’s weakest pace in nearly three years. In addition, the cost of insuring Spanish debt against default hit 500 basis points for the first time on fears about the high exposure of the country’s banking sector to sovereign debt.
The S&P financial sector index fell 1.9 percent and is down more than 2 percent for the week. Bank of America Corp dropped 4.4 percent to $8.77. Morgan Stanley slumped 3.8 percent to $17.52.
“Everyone is looking for global growth, but the slowing in China and the rising yields in Europe are creating questions about how strong we might expect it to be,” said Brad Sorensen, director of market and sector analysis at Charles Schwab in Denver. “That’s leading to a correction here, with financials especially taking a hit.”
The Dow Jones industrial average was down 72.05 points, or 0.55 percent, at 12,914.53. The Standard & Poor’s 500 Index was down 11.10 points, or 0.80 percent, at 1,376.47. The Nasdaq Composite Index was down 35.23 points, or 1.15 percent, at 3,020.32.
Weighing on the Nasdaq, Apple Inc dropped 2.3 percent to $608.35.
In the previous two sessions of back-to-back gains, the S&P 500 added 2.1 percent as immediate concerns about rising yields in Spain and Italy ebbed and on bets that the Chinese GDP data would surprise on the upside.
Banks fell despite earnings from JPMorgan Chase & Co and Wells Fargo & Co that beat Wall Street’s expectations. JPMorgan lost 2.8 percent to $43.57. Wells Fargo fell 2.4 percent to $32.21.
With 6 percent of S&P 500 components having reported, three-fourths of companies have reported profits that topped expectations.
“So far, so good with earnings, but expectations have been low, and it’s far too early to tell what the season will be like as a whole,” said David Kelly, chief market strategist for JPMorgan Funds in New York. “It’s understandable people want to take profits right now, especially given how much we’re up this year.”
The S&P is up 9.5 percent so far in 2012, but it is down 1.5 percent for the week. The Dow is down 1.1 percent for the week and the Nasdaq is off almost 2 percent.
Materials and energy shares dropped as copper and oil prices fell after the Chinese data. An S&P materials sector index shed 0.6 percent and an S&P energy sector index lost 0.9 percent.
Adding to concerns, two U.S. reports on Friday sent mixed signals to the Federal Reserve about how much room there might be to bolster economic growth.
The U.S. Consumer Price Index rose modestly in March among signs that a surge in gasoline costs was ebbing, but inflation still outpaced workers’ earnings and threatened to undermine spending.
The Thomson Reuters/University of Michigan survey showed U.S. consumer sentiment slipping modestly in early April as higher gasoline prices hit household budgets even as optimism about the economic outlook lifted consumers’ expectations.