You're reading: Stocks fall on slower growth in China

NEW YOR — U.S. stocks fell on Friday after worries about Europe returned, erasing about half of the market's gain from Thursday.

The Dow Jones industrial average was down 93 points at 12,892 in late morning trading. It jumped 181 points the day before. The broader Standard & Poor’s 500 index fell 12 points to 1,375. The Nasdaq composite fell 37 points to 3,018.

Concerns about prospects for global growth remained the market focus on Friday. New data showed the Chinese economy grew at an 8.1 percent pace in the January-March period, the slowest pace in almost three years.

Investors also worried about Europe’s debt problems. Yields rose on government bonds issued by Italy and Spain, meaning those countries will have to pay more to borrow money from investors.

Friday’s drop is "all about Europe," said Peter Cardillo, chief market economist at Rockwell Global Capital. He thinks investors are worried that Europe’s economic problems will be bigger than previously expected, although he doesn’t share that view.

Stocks opened lower and extended their losses after a closely watched gauge of consumer confidence came in weaker than analysts were expecting.

Also Friday, the U.S. government reported that inflation was mild in March outside of volatile food and gas prices.

The stock declines were broad. Only utilities and consumer staples stocks rose among the 10 market sectors tracked by the S&P 500 index. Both are considered refuges when investors fear a weakening economy or turbulence in financial markets.

Financial stocks declined the most, 1.5 percent. Bank of America Corp. fell more than 3 percent.

Wells Fargo & Co. and JPMorgan Chase & Co. both reported better-than-expected profits, but both fell almost 2 percent as investors focused on comments that said the overhang from bad loans would continue.

The dollar and Treasury prices rose. European markets fell broadly. France and Germany’s stock indexes each fell more than 2 percent. The yield on Spain’s 10-year government bond rose to 5.93 percent, Italy’s rose to 5.53 percent.

Among stocks making big moves:

— Google fell 3 percent after the company said it would issue new non-voting stock to shareholders.

— Coinstar, which runs the Redbox DVD rental kiosks, rose 9 percent after it raised its revenue forecast.

— Dow Chemical rose 2.4 percent after the company raised its quarterly dividend 28 percent. The company said last week it would eliminate 900 jobs and close several plants.