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US STOCKS-Markets drop on weak earnings, Nasdaq down 1 pct

Published 01/28/2011, 11:02 AM
Updated 01/28/2011, 11:04 AM

* Ford shares sink after results, weigh on GM

* Economy grows 3.2 pct in Q4, helped by consumer spending

* Dow could notch ninth straight week of gains

* Indexes down: Dow 0.5 pct, S&P 0.7 pct, Nasdaq 1.2 pct (Updates to with Nasdaq trading details)

By Ryan Vlastelica

NEW YORK, Jan 28 (Reuters) - U.S. stocks fell on Friday as weak corporate results, including Ford's, offset data showing the U.S. economic expansion gathered speed in the fourth quarter.

After a nearly one-hour delay, Nasdaq resumed publishing quotes for its main stock indexes, including the Nasdaq composite, after a data feed glitch.

Ford Motor Co slumped 10.5 percent to $16.80 after a steep drop in quarterly profit due to a charge for debt payments. Rival automaker General Motors Co lost 5 percent to $36.72.

"Ford was clearly disappointing, and the fact that it has been up so much lately is exacerbating the fall today," said Mark Bronzo, a money manager at Security Global Investors in Irvington, New York. Ford shares have risen almost 12 percent from the start of January through Thursday's close.

The economy grew at a 3.2 percent rate in the fourth quarter as consumer spending accelerated. Excluding inventories, however, sales grew about 7.1 percent, the best since 1984, according to government data.

"When you look at the components of the GDP number, it was a high-quality report because it lays the groundwork for further economic growth down the line," Bronzo said.

The Dow Jones industrial average was down 54.64 points, or 0.46 percent, at 11,935.19. The Standard & Poor's 500 Index was down 9.10 points, or 0.70 percent, at 1,290.44. The Nasdaq Composite Index was down 33.65 points, or 1.22 percent, at 2,721.63.

The Nasdaq tumbled after results from a pair of bellwether companies.

Dow component Microsoft Corp fell 3.6 percent to $27.82 a day after it posted a dip in profit, and online retailer Amazon.com Inc recorded revenue below the consensus view. The stock shed 8.2 percent to $169.36.

The Thomson Reuters/University of Michigan Surveys of Consumers' final January consumer sentiment fell slightly in the final December reading, but topped forecasts. Equities were little changed after the data.

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