US STOCKS-Market sinks on oil's surge; Nasdaq off 1 pct

(Updates with Nasdaq dropping 1 percent)

NEW YORK, May 7 (Reuters) - U.S. stocks extended losses on Wednesday, sending the Nasdaq down more than 1 percent, as investors worried that the fallout from record crude oil prices would crimp consumer spending and worsen the economy's outlook.

The Dow Jones industrial average .DJI dropped 94.20 points, or 0.72 percent, to 12,926.63. The Standard & Poor's 500 Index .SPX slid 11.90 points, or 0.84 percent, to 1,406.36. The Nasdaq Composite Index .IXIC tumbled 25.36 points, or 1.02 percent, to , 2,457.95. (Reporting by Ellis Mnyandu, Editing by Chizu Nomiyama)