US STOCKS-Wall Street reels under China shock
* China and U.S. factory activity shrank in December
* Dow makes worst start to the year since 1932
* Amazon top drag on S&P
* Indexes down: Dow 2.48 pct, S&P 2.37 pct, Nasdaq 2.81 pct (Updates to early afternoon)
By Abhiram Nandakumar
Jan 4 (Reuters) - The Dow Jones industrial average was set for its worst start to a year since 1932 as stock markets tanked after weak Chinese economic data reignited fears of a global slowdown.
Surveys showed factory activity in the world's second-largest economy shrank sharply in December, sparking a 7 percent slide in Chinese shares that triggered a trading halt.
Adding to investors' worries, China's central bank fixed the yuan at a 4-1/2 year low, further weakening it against the dollar.
U.S. data was also not encouraging, with factory activity shrinking unexpectedly in December, according to the Institute for Supply Management. Continuación...