US STOCKS-Dow, S&P fall for 3rd straight day; retail weighs


* Automakers' shares fall after November sales, but Teslasoars

* Amazon shares drop, with holiday shopping in focus

* Yum Brands stock falls after company says Nov China salesflat

* Dow down 0.6 pct, S&P 500 off 0.3 pct, Nasdaq off 0.2 pct

By Ryan Vlastelica

NEW YORK, Dec 3 (Reuters) - The Dow and the S&P 500 fell fora third straight day on Tuesday, dropping from record levels ina broad decline as investors took profits amid signs of a weakholiday shopping season.

Retail and consumer discretionary stocks were among theweakest of the day. Inc slipped 2 percent to$384.66 and was one of the biggest drags on the S&P 500. The S&Pretail index shed 0.8 percent after the holidayshopping season got off to a tepid start.

Earlier-than-usual online holiday discounts were expected tohave dampened Cyber Monday sales in the United States. Still,data firm comScore forecast U.S. online sales to have hit $2billion on "Cyber Monday," the highest since the firm begantracking such information.

"Retail sales have been mixed, and while I suspect they willbe strong overall at the end of the season, right now, investorsare looking for reasons to sell after the amazing returns we'veseen over the past several weeks," said Joseph Tanious, globalmarket strategist at J.P. Morgan Asset Management in New York.

Equities have rallied recently, with the S&P 500 gaining foreight straight weeks and hitting a series of record highs. Thebenchmark index is up 25.9 percent so far this year.

The Dow Jones industrial average fell 94.15 points,or 0.59 percent, to end at 15,914.62. The Standard & Poor's 500Index declined 5.75 points, or 0.32 percent, to finish at1,795.15. The Nasdaq Composite Index dropped 8.06points, or 0.20 percent, to close at 4,037.20.

The S&P consumer discretionary sector index fell0.9 percent, despite stronger-than-expected November auto sales.Ford Motor shares slid 2.9 percent to $16.56 while GeneralMotors dropped 2.5 percent to $38.14. Analysts said thedeclines in the automakers' stocks were linked to concerns thatpent-up demand would no longer support the pace of sales gainsbeyond 2014.

Bucking the sector's weakness, Tesla Motors jumped16.5 percent to $144.70 on heavy volume after Morgan Stanleynamed it a "top pick." Tesla said on Monday that Germany'svehicle regulatory agency said it planned "no further measures"after reviewing fires in Tesla cars in the United States andMexico.

Investors speculated that the Federal Reserve may move totrim its stimulus earlier than some had anticipated.Stronger-than-expected data on manufacturing and constructionspending on Monday underscored views that the Fed may beginscaling back its stimulus of $85 billion in monthly bondpurchases sooner than expected.

Many analysts still forecast the announcement will takeplace in March, but investors will be closely watching thisweek's jobs figures on Friday for trends that could influencethe Fed's thinking.

In an interview, John Williams, president of the SanFrancisco Federal Reserve Bank, said he expected the stimulusprogram to end sometime in 2014, and that he would bedisappointed if it was still in effect in December 2014.

In company news, Yum Brands Inc fell 2.7 percent to$75.61 after it said November sales at established KFCrestaurants in China failed to grow despite a successfulpromotion. It forecast a return to earnings-per-share growth in2014.

Apple Inc rose 2.7 percent to $566.32 after UBSupgraded the iPhone maker's stock to "buy."

About 5.28 billion shares traded on all U.S. platforms,according to BATS exchange data.

Decliners outnumbered advancers on the New York StockExchange by a ratio of about 3 to 2, while on the Nasdaq, nearlyeight stocks fell for every five that rose.

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