* Final U.S. Q3 GDP growth 3.5 pct vs estimated 3.3 pct
* Home Depot, Wal-Mart pull Dow lower
* S&P 500 up 11 pct so far in 2016
* Indexes end down: Dow 0.12 pct, S&P 0.19 pct, Nasdaq 0.44 pct (Updates to close)
By Noel Randewich
Dec 22 (Reuters) - U.S. stocks fell on Thursday, weighed down by weakness in retailers, as investors stepped back from a recent rally fueled by optimism that President-elect Donald Trump will invigorate economic growth.
The decline pulled the Dow Jones industrial average further away from the 20,000 mark after it nearly breached that level this week for the first time.
Retail stocks fell after CNN reported Trump's transition team is considering a tariff of as much as 10 percent on imports. The S&P 500 consumer discretionary index lost 1.01 percent, its biggest one-day decline since October.
Home Depot fell 1.02 percent and Wal-Mart Stores lost 2.32 percent, both weighing more than any other stocks on the Dow.
Following a sharp rally since the Nov. 8 U.S. election, the Dow is up about 14 percent for the year and the S&P 500 is 11 higher on bets that the economy will benefit from Trump's plans for deregulation and infrastructure spending.
Some investors believe that recent gains may have made stocks too expensive, and that Congress may water down or prevent major infrastructure spending or tax cuts proposed by Trump.
"There are issues hanging over the market," said Donald Selkin, chief market strategist at Newbridge Securities in New York. "You need to digest these gains, and once he becomes president, we'll see what is actually going to get passed."
Billionaire investor Carl Icahn, tapped by Trump on Wednesday as a special adviser for regulatory issues, said in an interview on CNBC he was concerned about the stock market in the short term following its recent surge.
A report earlier showed that the U.S. economy grew faster than initially thought in the third quarter, notching its best performance in two years. Gross domestic product increased at a 3.5 percent annual rate instead of the previously reported 3.2 percent pace, the Commerce Department said.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 0.2 percent in November, below the estimated 0.3 percent gain.
The Dow finished 0.12 percent lower at 19,918.88 and the S&P 500 lost 0.19 percent to end at 2,260.96. The Nasdaq Composite dropped 0.44 percent to 5,447.42.
Apple fell 0.66 percent after Nokia said it had sued the iPhone maker for patent infringement. The stock was the biggest drag on the S&P 500 and Nasdaq.
ConAgra rose 3.39 percent after the packaged foods maker's quarterly profit beat estimates.
Red Hat slumped 13.89 percent after the Linux software distributor's quarterly revenue missed estimates.
Declining issues outnumbered advancing ones on the NYSE by a 1.26-to-1 ratio; on Nasdaq, a 1.55-to-1 ratio favored decliners.
The S&P 500 posted 11 new 52-week highs and three new lows; the Nasdaq Composite recorded 100 new highs and 43 new lows.
With many investors already away for the end-of-year holidays, volume was very low. About 5.5 billion shares changed hands in U.S. exchanges, well below the 7.3 billion daily average over the last 20 sessions. (Additional reporting by Tanya Agrawal in Bengaluru; Editing by Meredith Mazzilli and James Dalgleish)