* Emerging markets ETF off 1.8 pct as Russia holds war games near Ukraine
* Latest China data points to slowing economy
* Initial jobless claims fall, retail sales tops estimate
* Dow off 1.4 pct; S&P off 1.2 pct; Nasdaq off 1.5 pct
By Angela Moon
NEW YORK, March 13 (Reuters) - U.S. stocks tumbled on Thursday, with the Dow and the S&P 500 suffering their worst day since early February, on rising concerns over Ukraine and Russia and new signs of a slowdown in China.
Selling accelerated in afternoon trading after Russia launched military exercises near its border with Ukraine, showing no sign of backing down in its plans to annex its neighbor's Crimea region despite a stronger-than-expected push for sanctions from the EU and the United States.
In an unusually robust and emotionally worded speech, German Chancellor Angela Merkel warned of "catastrophe" unless Russia changes course.
The CBOE Volatility index VIX, Wall Street's so-called fear gauge, jumped more than 12 percent to 16.22. The index usually moves inversely to the S&P 500. A key emerging market exchange-traded fund, iShares MSCI Emerging Markets ETF , fell 1.8 percent to $38.19.
"(Ukraine headlines) are certainly going to be the catalyst but there is more under the surface," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.
"There is no military solution to this. All it is, is positioning - and let's be realistic, these Chinese numbers last night were not good."
China's economy slowed markedly in the first two months of the year, as growth in investment, retail sales and factory output all fell to multi-year lows.
The S&P 500 broke below its 10-day and 14-day moving averages, which were acting as short-term technical support levels. It also broke below the 1,850 level.
The Dow Jones industrial average fell 231.19 points or 1.41 percent, to 16,108.89, the S&P 500 lost 21.86 points or 1.17 percent, to 1,846.34 and the Nasdaq Composite dropped 62.912 points or 1.46 percent, to 4,260.42.
Economically-sensitive sectors such as industrials , down 1.5 percent, and technology, down 1.6 percent, fared the worst. General Electric fell 1.6 percent to $25.34; Apple Inc lost 1.1 percent to $530.65.
Earlier, gains were supported by better-than-expected weekly initial jobless claims and retail sales data for February, although the prior month of retail sales was revised lower.
Import prices increased 0.9 percent last month, their biggest rise in a year as petroleum soared, but there was little sign of a broad pick-up in imported inflation.
About 7.5 billion shares traded on U.S. exchanges, according to BATS Global Markets, above the 6.8 billion daily average so far this month.