US stocks drop on weak economic data

US stocks were stuck in the red Friday, the last trading day of the third quarter, after disappointing business activity and consumer spending reports fueled concerns about the economy. The major indices closed off the worst levels of the day after results of Spain\'s bank stress tests were basically in line with expectations, analysts said. The Dow Jones Industrial Average fell 48.84 points (0.36 percent), finishing at 13,437.13. The S&P 500-stock index lost 6.48 (0.45 percent) at 1,440.67 and the tech-rich Nasdaq Composite shed 20.37 (0.65 percent) at 3,116.22. Business activity in the United States shrank for the first time in three years, according to the Institute for Supply Management-Chicago. Its purchasing managers index for the Midwest region fell to 49.7, below the breakeven 50 reading between growth and contraction. Consumer spending rose by 0.5 percent in August from July, but the increase was due to higher gasoline prices, the Commerce Department said. Inflation-adjusted spending rose just 0.1 percent. Dow member Bank of America skidded 1.6 percent after announcing it would pay $2.43 billion to settle a class-action lawsuit over its acquisition of Merrill Lynch at the height of the 2008 financial crisis. Company earnings were in focus. Research In Motion, the Canadian BlackBerry maker, jumped 5.0 percent to $7.50, well off a high of $8.20, after reporting a narrower quarterly loss. Walgreen, the nation\'s largest drug store chain, slipped 0.4 percent after posting fiscal fourth-quarter results that topped expectations Athletic apparel maker Nike dropped 1.1 percent on lower quarterly earnings and a glum outlook on China sales. Accenture added 7.1 percent. The global technology services giant reported fiscal 2012 earnings and record sales, and raised its full-year outlook for 2013. Apple apologized for its glitch-ridden maps application in its new operating system used by the iPhone 5. Shares tumbled 2.1 percent. On Thursday, the markets rallied amid speculation of fresh stimulus from China and after Spain unveiled a 2013 austerity budget that included reforms agreed with the European Union. Bond prices were mixed. The 10-year Treasury yield was unchanged from Thursday at 1.64 percent, while the 30-year yield edged up to 2.83 percent from 2.82 percent. Bond prices move inversely to yields.