By Anora Mahmudova and Barbara Kollmeyer, MarketWatch

Analyst: S&P 500 could be about to start a technical correction

U.S. stocks sold off on Friday as a confluence of intensifying Greek default fears and new stock-market regulation from China put investors on edge.

The S&P 500 and Dow Jones Industrial Average suffered their worst one-day point decline in more than three week and ended the week with losses after two consecutive weekly gains.

The Dow Jones Industrial Average (DJI) dropped 279.67 points, or 1.5%, to 17,826.10 and ended the week 1.3% lower. The blue-chip average turned negative for the year.

Also helping push the Dow lower was American Express Co.(AXP), which slipped 4.4% on Friday after the payment-card company said (http://www.marketwatch.com/story/amex-profit-buoyed-by-card-member-spending-2015-04-16-16485228)its results were hurt by a stronger dollar.

The carnage was equally intense in the tech-heavy Nasdaq Composite (RIXF), which ended the session down 75.98 points, or 1.5%, to 4,931.81, losing 1.3% over the week.

The S&P 500 index (SPX) closed 23.83 points, or 1.1%, lower at 2,081.16 and recorded a 1% loss over the week.

Why global markets staged a huge selloff, in 7 charts (http://www.marketwatch.com/story/why-global-markets-are-staging-a-sell-off-in-7-charts-2015-04-17)

Recent gains in European equity markets and high valuations of U.S. stock indexes also made them vulnerable to a pullback, according to some analysts.

Donald Ellenberger, senior portfolio manager at Federated Investors, said concerns over Greece and its ability to pay its debt are behind the selloff in risky assets such as equities.

"Investors have piled into German bunds and credit spreads widened. But it was news from China's regulators that triggered selling, as a lot of investors were sitting on gains after a run-up in equity markets," Ellenberger said.

Early morning fretting in China also helped stoke worries.

China's securities regulator tightened rules on margin lending (http://www.marketwatch.com/story/china-regulators-to-allow-short-selling-by-fund-managers-2015-04-17)while the country's two stock exchanges said they would make it easier to bet that stocks will fall in price in an effort to temper the country's soaring stock markets.

Joe Saluzzi, co-founder and co-head of equity trading at Themis Trading, noted that Friday's selling shouldn't be viewed as a sign of panic.

"The biggest losses were in early trade, clearly after news from China's financial regulator. But percentage-wise, today's losses are not that big and volumes are average. Implied volatility also jumped, which suggests nervousness," Saluzzi said.

The CBOE Volatility Index, or Vix (VIX) , which measures implied volatility in the S&P 500 jumped 11% to above 14.

"The S&P 500 has been stuck in a trading range since January, and unless earnings really come in above expectations, breaking higher above that range will be difficult, especially given high valuations," he said.

Read: Bloomberg Terminal goes down, traders get up to fun (http://www.marketwatch.com/story/bloomberg-terminal-goes-down-traders-get-up-to-fun-2015-04-17)

In economic news, consumer prices (http://www.marketwatch.com/story/consumer-prices-move-up-in-march-for-second-month-2015-04-17) rose for the second straight month in March, led by higher gasoline prices, according to data reported Friday by the Labor Department. The uptick was mostly in line with expectations.

Also read: Consumer sentiment, leading indicators improve (http://www.marketwatch.com/story/consumer-sentiment-leading-indicators-improve-2015-04-17)

Correction ahead? A technical analyst told CNBC on Friday that he expects major global benchmarks to begin correcting over the next month. "I think the correction has started on the DAX, and the S&P 500 we are probably on the top today," Yacine Kanoun, managing director at PivotHunters, a U.K.-based portfolio management company, said Friday (http://www.cnbc.com/id/102595532).

Need to Know: There is nothing quite like the smell of stock correction in the morning (http://www.marketwatch.com/story/when-sex-isnt-selling-it-might-be-time-to-get-defensive-2015-04-17)

Earnings:Mattel Inc (http://www.marketwatch.com/story/amex-profit-buoyed-by-card-member-spending-2015-04-16-16485228).(MAT) shares rose 5.8% after the toy maker posted a narrower-than-expected loss for the first quarter.

Advanced Micro Systems Inc.(AMD) shares plunged 10% after the chip maker posted a wider-fiscal first-quarter loss and weaker revenue.

Shares in Time Warner Cable Inc. (TWC) dropped 5.4%, after a Bloomberg reported that U.S. antitrust lawyers are nearing a recommendation to block merger with Comcast.

For more on today's notable movers read Movers & Shakers column (http://www.marketwatch.com/story/ge-reynolds-american-honeywell-earnings-in-focus-2015-04-17).

Other markets: In Asia, the Nikkei 225 posted a 1.2% drop, while the Shanghai Composite Index surged 2.2%. European stocks also slumped on the back of the news from China, with the Stoxx Europe 600 index off 1.7%.

Oil futures (http://www.marketwatch.com/story/oil-slips-as-high-opec-production-tempers-market-sentiment-2015-04-17-21031717)(CLK5) were under pressure, but were on track to record a hefty weekly gains. May crude contract was down 1.7% at $55.74 a barrel. Gold prices (http://www.marketwatch.com/story/gold-gaining-but-on-pace-for-weekly-decline-2015-04-17)(CLK5) settled higher as investors sought safety of perceived havens. The yellow metal settled 0.4% higher at $1,203.10.

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