* Second U.S. case of Wuhan coronavirus confirmed
* European shares jump as positive PMI paints rosier picture
* U.S. 10-year yield falls below 1.7%
* Oil drops more than 2%, heads for weekly loss (Updates with afternoon trading)
By Lewis Krauskopf and David Randall
NEW YORK, Jan 24 (Reuters) - U.S. shares and crude prices dropped on Friday and 10-year U.S. treasury yields fell to their lowest point in about three months amid concerns that a spreading virus from China would curb travel and hurt economic demand.
MSCI's gauge of stocks across the globe shed 0.42%, weighed down by Wall Street.
But European shares gained, as the STOXX 600 index rose 0.86%, after some encouraging regional economic data.
U.S. health officials confirmed a second U.S. case of the new coronavirus from China in a Chicago woman, as the illness spread around the globe.
"Concern about the extent of this virus out of China is capturing people’s attention,” said Willie Delwiche, investment strategist at Baird in Milwaukee.
“If concerns about a virus lead countries to close borders and restrict trade and travel, then that could have an impact on oil and an impact on global growth,” Delwiche said.
On Wall Street, the Dow Jones Industrial Average fell 193.16 points, or 0.66%, to 28,966.93, the S&P 500 lost 30.44 points, or 0.92%, to 3,295.1 and the Nasdaq Composite dropped 77.78 points, or 0.83%, to 9,324.70.
Losses on the major U.S. indexes were limited by an 8.1% gain in Intel shares following the chip industry's leader's better-than-expected forecast.
A survey showed Germany's private sector gained momentum in January as growth in services activity picked up and the pullback in manufacturing eased. British companies are enjoying their best month in more than a year, another survey showed.
"Sentiment among manufacturers is improving rapidly, meaning that expectations for a 2020 recovery are increasing," ING economist Bert Colijn said of the euro zone.
U.S. Treasury yields continued their recent declines as the coronavirus uncertainty undermined risk appetite and spurred demand for safe-haven assets.
Benchmark 10-year notes last rose 17/32 in price to yield 1.6822%, from 1.739% late on Thursday.
The dollar index rose 0.17%, with the euro down 0.22% to $1.1028.
The Japanese yen strengthened 0.22% versus the greenback at 109.26 per dollar.
Crude prices headed for steep weekly decline.
U.S. crude fell 2.55% to $54.17 per barrel and Brent was last at $60.57, down 2.37% on the day.
Reporting by David Randall; Editing by David Gregorio and Nick Macfie