Apple demand worries weigh on S&P, Nasdaq

NEW YORK (Reuters) - Wall Street dipped on Monday as concerns about demand for Apple products sent shares of the tech heavyweight lower and investors faced a busy week for earnings in what is expected to be a uninspiring quarter.

Apple lost 3.2 percent to $503.60 as the biggest weight on both the S&P 500 and Nasdaq 100 <.ndx> indexes after reports that the tech company has cut orders for LCD screens and other parts for the iPhone 5 this quarter due to weak demand. The stock earlier hit a session low of $498.51, the first dip below $500 since February 16.

"It's clear from them reducing their supply orders that the sales haven't met their expectations, though certainly the orders they put into place for the iPhone 5 displays were higher than those that were in place for the prior phone," said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.

"Certainly, the rate of growth that they had - the tremendous surge in their revenue, stock price, all things do eventually slow and come down, so it's not a big surprise - the big question always is when."

Apple suppliers also lost ground, with Cirrus Logic off 8.7 percent to $28.82 and Qualcomm down 1.4 percent to $63.98. The S&P tech sector <.gspt> declined 1 percent as the worst performer of the 10 major S&P sectors.

The pace of earnings season picks up this week with 38 S&P 500 companies set to report, including Goldman Sachs , Bank of America , Intel and General Electric .

Overall earnings are expected to grow by just 1.9 percent in this reporting period, according to Thomson Reuters data.

President Barack Obama warned Congress at a news conference on Monday that a refusal to raise the U.S. debt ceiling next month, leading to a government shutdown, could trigger economic chaos.

"Again, we are dealing with a public relations type of approach trying to get to (Obama's) preferred result," Jankovskis said.

Separately, Federal Reserve Chairman Ben Bernanke will be speaking on monetary policy, recovery from the global financial crisis and long-term challenges facing the American economy at 4 p.m. (0200 EST).

The Dow Jones industrial average <.dji> gained 0.76 points, or 0.01 percent, to 13,489.19. The Standard & Poor's 500 Index <.spx> shed 4.24 points, or 0.29 percent, to 1,467.81. The Nasdaq Composite Index <.ixic> lost 16.42 points, or 0.53 percent, to 3,109.21.

Appliance and electronics retailer Hhgregg Inc slumped 8.9 percent to $7.19 after the electronics and appliance retailer cut its same-store sales forecast for the full year.

Transocean Ltd has disclosed that billionaire activist investor Carl Icahn has acquired a 1.56 percent stake in the offshore rig contractor and is looking to increase that holding. Its shares advanced 0.9 percent to $54.58.

The Dow, which does not list Apple as one of its components, fared better than the other two indexes as Hewlett-Packard rose 3.7 percent to $16.75 after JPMorgan upgraded its rating on the stock and raised its price target to $21 from $15.

(Reporting by Chuck Mikolajczak; Editing by Kenneth Barry and Nick Zieminski)

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