* Jobless claims fall more than expected
* China data sparks fears of tightened policy
* Morgan Stanley gains as profit jumps 60 percent (Updates to open)
By Angela Moon
NEW YORK, Jan 20 (Reuters) - U.S. stocks fell on Thursday led by losses in the technology sector and on worries that China's rapid growth may lead to more aggressive measures to tackle inflation.
After U.S. stocks suffered their worst decline in nearly two months on Wednesday on disappointing results from Goldman Sachs, investors were concerned the early selloff may grow worse.
Shares of networking/cloud computing companies weighed on the Nasdaq index, a day after F5 Networks Inc forecast weak revenues, sparking concerns that Internet traffic may not be growing as fast as expected.
F5 Networks was down 18.7 percent at $112.84.
On the upside, Morgan Stanley, the No. 2 U.S. investment bank, posted a 60 percent jump in quarterly profit, sending its shares up 1.2 percent at $28.08.
The Dow Jones industrial average was down 26.18 points, or 0.22 percent, at 11,799.11. The Standard & Poor's 500 Index was down 5.55 points, or 0.43 percent, at 1,276.37. The Nasdaq Composite Index was down 19.94 points, or 0.73 percent, at 2,705.42.
Chinese gross domestic product soared past forecasts to grow 9.8 percent in the fourth quarter, with inflation slowing less than expected. This may lead Beijing to move more aggressively to quell growth and keep the economy from overheating.