By Dion Rabouin
NEW YORK (Reuters) - Major stock markets around the world fell on Monday and U.S. and European bond yields slipped off four-month highs amid uncertainty over the health of the global economy.
U.S. stocks fell as declining oil prices pushed energy stocks down and traders sold Bank of America shares
Stocks touched their lows of the day following comments from Federal Reserve Vice Chairman Stanley Fischer, who said economic stability could be threatened by low interest rates, but it was "not that simple" for the Fed to raise rates.
European stocks closed lower across the board with the pan-European FTSE Eurofirst 300 <.FTEU3> index down 0.69 percent.
"I think we're headed for a bumpy session with earnings leading the way," said Peter Cardillo, chief market economist at First Standard Financial in New York. "It's also a jittery market ahead of the elections and of course the prospects of a rate hike (by the U.S. Federal Reserve) in December."
The Dow Jones industrial average <.DJI> fell 60.36 points, or 0.33 percent, to 18,078.02, the S&P 500 <.SPX> lost 6.56 points, or 0.31 percent, to 2,126.42 and the Nasdaq Composite <.IXIC> dropped 13.04 points, or 0.25 percent, to 5,201.12.
A gauge of equity markets around the globe <.MIWD00000PUS> was down 0.25 percent.
Oil fell around 1 percent as a rising U.S. rig count kept investors worried about a persisting glut. The energy sector led all S&P components lower, down 0.75 percent in early trading.
Brent crude futures
U.S. and European government bonds reversed earlier selling and rose in price after benchmark 10-year Treasury note yields hit their highest since June 2 and German and British bonds touched their highest since late June.
Buying in Treasuries was spurred by bargain-hunting investors who scooped up government debt that had fallen in price on Friday following remarks by Federal Reserve Chair Janet Yellen, analysts said. Yellen had said the central bank may tolerate inflation above its 2-percent goal.
The rise in prices also followed a sub-par reading from the New York Fed's gauge on regional business activity in October.
The 10-year U.S. Treasury
British 10-year gilt yields
German 10-year bunds
The U.S. dollar retreated from a seven-month high as some investors took profit following a recent rally that received a boost on Friday by Yellen's comments and solid U.S. data.
(Editing by Nick Zieminski and Bernadette Baum)