US STOCKS-Wall Street drops after Saudi attacks, energy stocks spike

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* Dow set to snap 8-day winning streak
* Energy sector eyes biggest one-day jump since Jan. 4
* Airlines, cruise operators fall on cost concerns
* United Auto Workers call for strike on GM; shares fall
* Indexes: Dow -0.44%, S&P 500 -0.31%, Nasdaq -0.28%

(Updates to afternoon)
By Noel Randewich
Sept 16 (Reuters) - Energy stocks spiked while the rest of
Wall Street fell on Monday after weekend attacks on Saudi
Arabia's oil facilities added to investors' concerns about
geopolitical risk and a slowing global economy.
The attacks on the world's biggest crude exporter sent oil
prices up more than 20% before they eased as various nations
said they would tap emergency reserves to ensure stable
supplies. The S&P 500 energy .SPNY , one of the worst performing
sectors so far this year, soared 3.75%, on track for its largest
one-day gain since December. Shares of Apache Corp APA.N ,
Marathon Oil Corp MRO.O and Helmerich and Payne HP.N jumped
between 12% and 18% and were the leading gainers on the S&P 500.
The Saudi-led military coalition battling Yemen's Houthi
movement said the attack was carried out with Iranian weapons,
raising the prospect of a global conflict involving the United
States and Iran.
"The U.S. investor is waiting with bated breath about what
the U.S. and its allies might do," said Jake Dollarhide, chief
executive officer of Longbow Asset Management in Tulsa,
Oklahoma.
Anticipation of higher fuel costs drove down shares of
airlines and cruise line operators with the S&P 1500 airlines
.SPCOMALI shedding 2.5%, while Carnival Corp CCL.N fell
3.7%.
Retail stocks .SPXRT lost 1.5% and were among the biggest
drags on the S&P 500.
"The drone strike in Saudi has had an impact on how
investors are looking at the security and stability of the
global energy supply chain and is fueling a degree of risk
reassessment," said Peter Kenny, founder of Kenny's Commentary
LLC and Strategic Board Solutions LLC in New York.
Shares of defense companies Raytheon RTN.N , Lockheed
Martin Corp LMT.N , Northrop Grumman Corp NOC.N rose more
than 1%. J.P. Morgan upgraded Raytheon shares to "overweight."
At 2:27 p.m. ET, the Dow Jones Industrial Average .DJI was
down 0.44% at 27,098.81 points, while the S&P 500 .SPX lost
0.31% to 2,998.13.
The Nasdaq Composite .IXIC dropped 0.28% to 8,153.98.
Nine of the 11 major S&P sectors were lower.
Wall Street's more than a decade-long rally continues to
hinge on whether the Fed will keep cutting interest rates and on
progress in U.S.-China trade talks. A recent easing in trade
tensions has brought the benchmark S&P 500 .SPX about 1% below
its record high.
Among other movers, General Motors Co GM.N fell 4.7% after
the United Auto Workers went on strike on Sunday, the first
nationwide strike at GM in 12 years. Advancing issues outnumbered declining ones on the NYSE by a
1.14-to-1 ratio; on Nasdaq, a 1.24-to-1 ratio favored advancers.
The S&P 500 posted 5 new 52-week highs and 1 new low; the
Nasdaq Composite recorded 47 new highs and 24 new lows.