* Next installment to Athens to follow audit of finances
* Shares of materials companies slump as commodities fall
* Amazon unveils tablet computer, shares rally
* Indexes down: Dow 0.7 pct, S&P 1.2 pct, Nasdaq 1.3 pct
* For up-to-the-minute market news see [STXNEWS/US] (Updates to late afternoon)
By Edward Krudy
NEW YORK, Sept 28 (Reuters) - Commodity-related stocks drove Wall Street lower on Wednesday as stiff declines in energy and metals prices underscored investor concerns about global economic weakness and Europe's festering debt crisis.
The down draft, which comes after three days of gains, put the S&P 500 on course for its worst quarter since the depths of the financial crisis in fourth quarter of 2008.
The S&P materials sector <.GSPM> fell 3.7 percent as copper
futures
"There is certainly a lot of headline risk and a lot of weak hands that hold stocks after this big rally we've had in the last three days," said Robert Francello, head of equity trading for Apex Capital, a hedge fund in San Francisco.
Cliffs Natural Resources Inc
In the wider market the Dow Jones industrial average <.DJI> dropped 83.37 points, or 0.74 percent, to 11,107.32. The Standard & Poor's 500 Index <.SPX> dropped 13.71 points, or 1.17 percent, to 1,161.67. The Nasdaq Composite Index <.IXIC> dropped 32.06 points, or 1.26 percent, to 2,514.77.
The drop coincided with news early in the afternoon that bans on short-selling stocks in France, Italy and Spain have been extended, according to a European Union markets watchdog.
Investors were on edge as inspectors from the European Union and International Monetary Fund headed to Greece to scrutinize new austerity measures they must endorse for Athens to get the next installment of aid.
German Chancellor Angela Merkel suggested that parts of a planned new $148.6 billion rescue for the debt-laden country could be reopened, depending on the audit's outcome. For details, see [ID:nL5E7KR3D4] [ID:nL5E7KS1IL]
A push to solidify a euro zone rescue fund and alleviate the region's sovereign debt crisis lifted stocks on Tuesday for a third consecutive session, following four straight days of losses for the benchmark S&P 500. The S&P gained more than 4 percent over that three-day period.
Market direction also may be influenced by quarter-end "window dressing," as portfolio managers drop underperforming stocks and buy outperformers.
Amazon.com Inc
Microsoft Corp
In earnings news, Jabil Circuit Inc
In economic news, orders for long-lasting U.S. manufactured goods slipped in August on weak demand for motor vehicles, but a rebound in a gauge of business spending suggested the economy would avoid another recession. [ID:nS1E78R088]
(Reporting by Ryan Vlastelica; Editing by Chizu Nomiyama)