US STOCKS-Wall Street drops, ends worst week since August

(Adds detail on close)

* Indexes close lost more than 3 pct this week

* Cisco's forecast drags on tech stocks

* Dept. store chains' weak outlook hits retailers

* Indexes end down: Dow 1.16 pct, S&P 1.12 pct, Nasdaq (NasdaqGS: NDAQ - news) 1.54 pct

By Noel Randewich

Nov 13 (Reuters) - Wall Street fell sharply on Friday and capped off its worst week since the dark days of August, hurt by a selloff in technology companies, while department stores dropped on concerns about the upcoming holiday shopping season.

The three major indexes ended the week down more than 3 percent, firmly putting the brakes on a fast rally that began in October.

Dow component Cisco dropped 5.8 percent after it gave a flimsy forecast, citing a slowdown in orders and weak spending outside the United States.

It (Other OTC: ITGL - news) was the second-biggest drag on the S&P and the Nasdaq and pulled down shares of tech heavyweights including Apple (LSE: 0R2V.L - news) and Facebook (NasdaqGS: FB - news) .

Retailers were hit by disappointing reports from department store chains. Nordstrom (NYSE: JWN - news) lowered its full-year forecast on Thursday, spooking investors already on edge after Macy's cut its forecast on Wednesday.

Added to that, data showed U.S (Other OTC: UBGXF - news) . retail sales rose less than expected in October, suggesting a slowdown in consumer spending.

Consumer stocks have been a bright spot this year as weak commodity prices, fears of a global slowdown and the anticipation of a U.S. rate hike have hit most stocks, especially those of materials, energy and industrial companies.

The S&P 600 smallcap index lost 4.6 percent for the week, its worst weekly performance in over three years.

The underperformance of smallcaps relative to larger companies in recent weeks hints at vulnerability in the broader market, said Alan Gayle, senior investment strategist at RidgeWorth Investments in Atlanta (BSE: ATLANTA.BO - news) , which has $50 billion in assets under management.

"The market got to up within about a percent of its previous record high. It got overbought, but we really didn't get the follow-through we wanted from the small caps," Gayle said.

The Dow Jones industrial average fell 1.16 percent to finish at 17,245.24 points and the S&P 500 lost 1.12 percent to 2,023.04. The Nasdaq Composite dropped 1.54 percent to 4,927.88.

All three major indices had their worst week since August, when fears about the health of China's economy and stock market slammed global asset prices.

The Dow lost 3.7 percent for the week, the S&P fell 3.6 percent and the Nasdaq declined 4.3 percent.

For 2015, the S&P is now down about 2 percent.

Nine of the 10 major S&P sectors finished lower on Friday, with the consumer discretionary sector's 2.65 percent fall leading the decliners.

Nordstrom and J.C. Penney both sank about 15 percent.

Fossil slumped 36.50 percent after the watchmaker said current-quarter sales could fall as much as 16 percent.

The S&P technology index fell 2.01 percent, with Apple down 2.92 percent. Facebook fell 3.77 percent, its worst day in over a month.

Declining issues outnumbered advancing ones on the NYSE by 1,903 to 1,154. On the Nasdaq, 1,761 issues fell and 1,027 advanced.

The S&P 500 index showed no new 52-week highs and 36 new lows, while the Nasdaq recorded 29 new highs and 181 new lows.

About 7.7 billion shares changing hands on U.S. exchanges, well above the 7.1 billion daily average for the past 20 trading days, according to Thomson Reuters (Dusseldorf: TOC.DU - news) data. (Additional reporting by Abhiram Nandakumar in Bengaluru; Editing by Savio D'Souza Editing by Nick Zieminski)