* S&P, Dow edge down after Fed decision; tech boosts Nasdaq
* Fed leaves rates unchanged, stays on course for September hike
* Oil falls 2 pct on rising supply, concern about trade tensions
* Apple's strong earnings lift Wall Street, ease trade worries
* Ten-year Treasury yield above 3 pct as U.S. steps up borrowing
* Dollar edges up against basket of currencies (Updates with close of U.S. markets)
By Laila Kearney
NEW YORK, Aug 1 (Reuters) - Stocks fell worldwide on Wednesday on persistent fears of an escalation of the trade war between the United States and China although robust results from Apple Inc helped cap losses and the Federal Reserve left U.S. interest rates untouched.
Apple, which jumped nearly 6 percent to a record high of $201.76 after predicting a surge in current-quarter sales, pulled the NASDAQ into positive territory and lifted the other two major U.S. stock indexes. The Mac and iPhone-maker saw its best day since February 2017.
Still, market participants said Wednesday's reversal after a recent selloff of tech shares might not be sustainable as investors turn their attention back to trade disputes.
"There is a big additional tariff that is being weighed and could be put into place at any moment, which is a concern," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin.
The U.S. administration plans to propose tariffs of 25 percent instead of 10 percent on $200 billion worth of imported Chinese goods. China called the move "blackmail" and warned it would respond in kind.
The Dow Jones Industrial Average fell 81.37 points, or 0.32 percent, to 25,333.82, the S&P 500 lost 2.93 points, or 0.10 percent, to 2,813.36 and the Nasdaq Composite added 35.50 points, or 0.46 percent, to 7,707.29.
MSCI's gauge of stocks across the globe shed 0.16 percent, while the pan-European FTSEurofirst 300 index lost 0.48 percent.
The Federal Reserve on Wednesday kept benchmark U.S. interest rates unchanged after a two-day meeting but in a statement characterized the economy as strong, keeping the central bank on track to increase borrowing costs in September.
While equities sold off ahead of the Fed's statement, Wall Street barely reacted after it was released.
“There were no major surprises," said Mark Grant, managing director and chief global strategist at investment bank B. Riley FBR Inc. "The Fed upgraded their view on the economy from 'solid' to 'strong' which is a slight positive, but nothing more than that. There was very little reaction to the statements in any of the markets."
The yield on the benchmark 10-year U.S. Treasury note was also little moved by the Fed statement, but it broke above 3 percent for the first time since June 13 after the U.S. government said it would boost borrowing in the coming quarter to fund spending and debt obligations.
The government needs to fund a rising budget deficit even as the Fed continues to reduce its massive bond portfolio.
The dollar index rose 0.18 percent, with the euro down 0.27 percent to $1.1659.
The Japanese yen strengthened 0.24 percent versus the greenback at 111.60 per dollar after Tuesday's pledge by the Bank of Japan to keep rates extremely low for an extended period.
Traders appeared to be putting the BOJ's tolerance for higher yields to the test on Wednesday as the benchmark 10-year Japanese government bond yield rose to 0.12 percent in its biggest one-day rise in two years.
Oil prices fell on data showing an unexpected rise in U.S. crude stockpiles while investors worried that trade tensions could hit energy demand. The price slump follows their largest monthly decline in two years in July.
Brent crude futures fell $1.82 to settle at $72.39 a barrel, a 2.5 percent loss. U.S. West Texas Intermediate (WTI) crude futures fell $1.10 to settle at $67.66, a 1.6 percent loss. (Additional reporting by Tom Finn, Tommy Wilkes, Dhara Ranasinghe, Amy Caren Daniel, Stephanie Kelly and Kate Duguid; Editing by Bernadette Baum and James Dalgleish)