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* S&P 500 & Dow hit 2-week low, Nasdaq near 3-week low
* September consumer confidence data weaker than expected
* Retail stocks, Amazon fall after data
* Energy sector tumbles as oil prices fall
* Indexes down: Dow 0.70%, S&P 0.90%, Nasdaq 1.46% (Updates to early afternoon)
By Ambar Warrick and Medha Singh
Sept 24 (Reuters) - The S&P 500 and the Nasdaq were set for their worst drops in one month on Tuesday as calls for impeachment of U.S. President Donald Trump gained momentum, while weak consumer confidence data added to worries over the prolonged Sino-U.S. trade war.
Losses in U.S. stocks accelerated, with the Dow Industrials set for its sharpest drop in three weeks after U.S. Representative John Lewis on Tuesday became one of the most senior Democrat leaders in calling for impeachment proceedings to begin against Trump.
Calls from some Democrats for Trump's impeachment for trying to enlist a foreign power to smear a domestic opponent increased after a whistleblower from within the U.S. intelligence community lodged a complaint with an internal watchdog about a phone conversation between Trump and Ukrainian President Volodymyr Zelensky.
Trump denied that he had held back U.S. aid to Ukraine as leverage to initiate an investigation that would damage Democratic political rival Joe Biden.
"The situation between the President and what occurred in the Ukraine and of course possibly bringing charges towards (his) impeachment, I think that's what led to the selloff largely being run by the algorithms," said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.
Wall Street's major indexes lost footing earlier in the day as Trump took a harsh tone in addressing China's trade practices, while disappointing consumer confidence data raised concerns over the economic impact of a prolonged trade war between the two nations.
U.S. stocks had opened higher on positive comments on trade talks from Treasury Secretary Steven Mnuchin.
The retail index slipped 1.3%, while a 2.2% drop in ecommerce giant Amazon.com Inc was the biggest drag on the S&P 500 and the Nasdaq.
The report is a bit of a concern, said Everett Millman, precious metals specialist at Gainesville Coins in Lutz, Florida, especially as "consumer confidence has been pretty high at least in the U.S."
Investors will now look to other data due later this week, including the Fed's preferred gauge for inflation, for more clues on the strength of the U.S. economy.
At 13:46 ET, the Dow Jones Industrial Average was down 187.54 points, or 0.70%, at 26,762.45, the S&P 500 was down 27.03 points, or 0.90%, at 2,964.75. The Nasdaq Composite was down 118.36 points, or 1.46%, at 7,994.11.
The benchmark S&P 500 hit a two-week low.
Nine of the 11 major S&P sectors were lower, with the energy sector down 1.8%, tracking a drop in oil prices.
Only the defensive consumer staples and utilities sectors were higher.
Video streaming platform Netflix Inc dropped 4% to a near nine-month low after Pivotal Research cut its price target.
Nike Inc fell 0.9%, ahead of the world's largest sportswear maker's first-quarter results after the bell.
Declining issues outnumbered advancers for a 2.20-to-1 ratio on the NYSE and a 3.47-to-1 ratio on the Nasdaq.
The S&P index recorded 31 new 52-week highs and two new lows, while the Nasdaq recorded 36 new highs and 83 new lows. (Reporting by Ambar Warrick, Arjun Panchadar and Medha Singh in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta)