US stocks have fallen as investors digested an unexpected decline in consumer credit, another weak signal on consumer spending, and Apple plummeted ahead of its expected iPhone 5 launch.

The Dow Jones Industrial Average on Monday finished down 52.35 points (0.39 per cent) at 13,254.29.

The S&P 500-stock index dropped 8.84 (0.61 per cent) to 1,429.08, while the tech-heavy Nasdaq shed 32.40 (1.03 per cent) at 3,104.02.

Apple was a big drag on the Nasdaq and the S&P 500, tumbling 2.6 per cent ahead of Wednesday’s expected announcement of the next generation of its popular iPhone, dubbed the iPhone 5.

“US equities finished lower in lacklustre action, losing steam toward the close, as traders appear to (again) be waiting for major events to unfold in the latter part of the week,” said Charles Schwab & Co. analysts.

The Federal Reserve opens a two-day policy meeting Wednesday amid speculation the central bank will unveil support for the flagging economy.

The indices accelerated their losses in the final hour of trade after the Fed reported consumer credit fell in July after 10 months of gains, raising concerns about consumer confidence amid high unemployment.

The blue-chip Dow was dragged down by Intel, off 3.8 per cent, after it slashed its third-quarter revenue outlook.

Other major Dow decliners were Boeing, down 2.5 per cent; 3M, 2.3 per cent; and Caterpillar, 1.1 per cent.

Computer giant Hewlett-Packard rose 0.8 per cent after announcing that job cuts under a major restructuring program will total some 29,000, or 2,000 more than previously estimated.

AIG fell 2.0 per cent after the Treasury Department launched a public offering to sell $18 billion of the giant insurer’s stock.

US-traded BP shares edged up 0.1 per cent. The British oil giant plans to sell $5.55 billion in oil assets in the Gulf of Mexico to Texas rival Plains Exploration, down 10.5 per cent.

Navistar International slid 3.1 per cent after activist investor Carl Icahn pressed the company for more representation on the board.

Bond prices fell. The yield on the 10-year Treasury rose to 1.68 per cent from 1.66 per cent Friday, while the 30-year yield edged up to 2.84 per cent from 2.83 per cent. Bond yields move inversely to prices.