* S&P 500 on track for second straight weekly decline
* Procter & Gamble leads the Dow's gainers after results
* Dow down 1.2 pct, S&P 500 off 1.3 pct, Nasdaq off 1.5 pct
NEW YORK, Jan 24 (Reuters) - U.S. stocks fell on Friday, on the heels of a selloff in emerging market assets, hurt by growth concerns in China and as expectations grew that the Federal Reserve will trim its market-friendly stimulus measures further.
A rout in emerging market assets spread to developed countries in Europe on worries about Fed policy, slowing growth in China and political problems in Turkey, Argentina and Ukraine.
Friday's slide put the S&P 500 on track for its worst drop since Nov. 7, pushing the index down 1.8 percent for the week. The benchmark index fell below its 50-day moving average for the first time since Dec. 18, a technical support level that could indicate more selling pressure if convincingly pierced.
"The big question, the one that everybody is trying to get their brain around is: 'Is this the correction that is the buying opportunity or are we setting up for something a little bit different?"' said Gordon Charlop, managing director at Rosenblatt Securities in New York.
"You had to figure, at some point, the multiples were expanding to a spot where we were going to not see the same kind of growth we saw last year in terms of equity returns."
Among the 10 major S&P 500 sectors, the industrials index fared the worst, down 2.3 percent as General Electric Co lost 2.7 percent to $25.13 and Boeing Co fell 2.9 percent to $137.23.
The Dow Jones industrial average fell 194.36 points or 1.2 percent, to 16,002.99. The S&P 500 lost 23.3 points or 1.27 percent, to 1,805.16. The Nasdaq Composite dropped 61.745 points or 1.46 percent, to 4,157.13.
But in a signal that the selling may be overextended, investors were willing to pay more for protection against a drop in the S&P 500 today than three months down the road. The last time the spread between the CBOE volatility index and three-month VIX futures turned negative was in mid- October, shortly after a 4.8 percent pullback in the S&P 500 opened the door to the last leg of the 2013 market rally.
With many market participants expecting the Fed to decide next week to shave its stimulus by another $10 billion a month, investors will look to less risky assets such as U.S. bonds on expectations that interest rates will begin to rise. The Fed's policymakers will conclude a two-day meeting on Wednesday.
Worries over China's growth surfaced after a disappointing manufacturing number spurred the S&P 500 to a 0.9 percent drop on Thursday.
The Turkish lira hit a record low and the South African rand fell to five-year low against the dollar.
U.S.-listed shares of Banco Bilbao Vizcaya Argentaria, S.A. tumbled 3.9 percent to $12.19 a day after the country's peso currency marked its steepest daily decline in 12 years, prompting Argentina's government to loosen strict foreign-exchange controls.
Argentina's government said on Friday it would relax stringent foreign-exchange controls, after it abandoned its long-standing policy of intervening to support the peso currency. That resulted in the currency's steepest plunge since the 2002 financial crisis.
Going against the day's downdraft was Procter & Gamble Co , which advanced 2.7 percent to $80.37 and led the Dow's gainers. The stock jumped after the world's largest household products maker reported lower quarterly profit, but kept its 2014 sales forecast unchanged.
Microsoft Corp shares rose 2.6 percent to $36.98 and gave the biggest boost to the S&P 500 after the world's largest software company posted a bigger-than-expected quarterly profit.
Honeywell International Inc reported higher-than-expected fourth-quarter profit and revenue on Friday, as sales grew across the diversified manufacturer's major segments. But its stock gave up its earlier gain and slipped 0.4 percent to $89.48 at midday.
Thomson Reuters data through Friday morning showed earnings for the fourth quarter are expected to grow 7.5 percent. Of the 122 companies in the benchmark S&P 500 index that have reported results so far, 63.9 percent beat expectations, slightly above the long-term average of 63 percent.