Markets drop after consumer confidence data

NEW YORK (Reuters) - Stocks fell on Tuesday after weak consumer confidence data poured cold water on investors looking to extend a blistering September rally.

Signs the economy was on firmer footing have boosted equities about 9 percent so far this month, but the unexpected drop in consumer confidence challenged that view.

"There's not a lot of good in the report. It really missed expectations, though I'm somewhat surprised the market is taking it on the chin like it is," said Nicholas Colas, chief market strategist at the Convergex Group in New York.

The Dow Jones industrial average <.DJI> dipped 11.50 points, or 0.11 percent, to 10,800.54. The Standard & Poor's 500 <.SPX> fell 3.54 points, or 0.31 percent, to 1,138.62. The Nasdaq Composite <.IXIC> was off 11.22 points, or 0.47 percent, to 2,358.55.

Technology shares led the market decline in early trading. Apple Inc fell as much as 5.6 percent before easing to trade down 1.8 percent at $286.05. The stock hit all-time intraday highs every session last week as well as on Monday.

Research in Motion Ltd dropped 3.3 percent to $46.73 a day after it unveiled a new tablet computer.

U.S. consumer confidence ebbed in September to its lowest levels since February, driven by deteriorating labor market and business conditions, a private report showed.

Walgreen Co , the biggest U.S. drugstore chain, reported higher-than-expected quarterly earnings, helped by strong prescription drug sales. Its shares jumped 9.4 percent to $33.18.

Continuing the spurt of recent M&A activity, Endo Pharmaceuticals Holdings Inc will buy private generics maker Qualitest Pharmaceuticals for about $1.2 billion, marking its second deal in as many months. The stock advanced 9 percent to $33.36.

(Reporting by Edward Krudy; additional reporting by Ryan Vlastelica; editing by Jeffrey Benkoe)

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