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GLOBAL MARKETS-Stocks mostly lower, dollar steady, on jobs report, lockdowns

* World stocks down for third straight day

* Oil, bonds ease, dollar steadies after U.S. jobless claims

* COVID-19 infection rates surge in United States, Japan

NEW YORK, Nov 19 (Reuters) - Stocks were broadly lower on Thursday, and oil prices slipped, as a weak reading on U.S. employment and new COVID-19 restrictions offset recent optimism about reported progress on coronavirus vaccines.

The dollar steadied and U.S. 10-year Treasury yields fell after the U.S. reported an unexpectedly large rise in jobless claims in the week ended Nov. 14.

The latest U.S. tally of new claims for unemployment insurance showed 742,000 compared with 711,000 the prior week and forecasts of 707,000 among economists polled by Reuters.

The dollar had been trending higher earlier in the day, though its gains were tempered by renewed concern about further monetary easing to shore up the economy.

The Dow Jones Industrial Average was down 0.16% and the S&P 500 was off 0.33%, while the tech-heavy Nasdaq Composite had added 0.28%.

Positive news about possible vaccines had helped push the MSCI World Index to a record high earlier in the week, but investors pulled back as a host of countries announced record infection rates and tougher lockdowns to curb the virus’ spread.

The MSCI benchmark for global equity markets fell 0.45% to 610.11. Europe’s broad FTSEurofirst 300 index dropped 0.75% to 1,496.62.

The dollar index rose 0.017%, with the euro down 0.08% to $1.1843.

Treasuries Benchmark 10-year notes rose 8/32 in price to yield 0.857%, compared with 0.882% late on Wednesday.

The weaker sentiment was partly triggered by a late sell-off in the U.S. on Wednesday. The S&P 500 closed down 1.1%, following news that the country’s COVID-19 deaths had passed 250,000, setting off a host of lockdowns. New York City’s public school system, the country’s largest, halted in-classroom instruction in response to rising infections rates.

Similarly sombre news in Japan, which saw a record number of cases and a rise in Tokyo’s pandemic alert level, sent the Nikkei down 0.4%. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.8%.

“The markets probably overshot the vaccine news and are probably just retreating slightly now because case numbers are going up,” said Gavin Rochussen, chief executive of UK-based asset manager Polar Capital.

The positive vaccine news had continued Wednesday after Pfizer said its COVID-19 vaccine was 95% effective and it would apply for emergency U.S. authorization within days, following a similar recent report from Moderna.

“The vaccines news are a positive medium-term impulse for the global economic outlook and investors are trying to weigh that against the prospect of an imminent stalling of the European and U.S. recovery amid the prospect of extensions of current lockdown measures,” said Rodrigo Catril, a senior FX strategist at NAB.

Reporting by Alwyn Scott in New York and Simon Jessop in London; Editing by Bernadette Baum

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