* Wall St falls as tariff deadline nears
* Bond yield, oil prices decline also on China fears
* Trump says China "broke the deal;" talks resume Thursday (Updates to late afternoon, adds commentary)
By Sinéad Carew
NEW YORK, May 9 (Reuters) - Stock indexes around the world fell for a fourth day in a row on Thursday, but Wall Street pared its losses after comments from President Donald Trump about U.S.-China trade talks a day before the United States was due to raise tariffs on Chinese goods.
Trump said he had received a "beautiful letter" from Chinese President Xi Jinping asking that they work together to "get something done" as negotiations between the world's two biggest economies continued in Washington.
Oil prices also pared losses while U.S. Treasury yields rose after touching near six-week lows. The dollar was still down against Japan's yen as investors sought a safe haven currency, but it too regained some ground.
Earlier in the day China had asked the United States to meet it halfway in the hope of staving off a tariff hike on $200 billion of Chinese goods to 25% from 10% at 12:01 a.m EDT (0400 GMT) on Friday.
"What the market fears deep down is an all-out trade war with no hope for resolution," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
"Trading today is telling me that the expectation for a trade deal is now that it's likely to happen a bit sooner than months away or never," he said.
The Dow Jones Industrial Average fell 189.19 points, or 0.73%, to 25,778.14, the S&P 500 lost 14.69 points, or 0.51%, to 2,864.73 and the Nasdaq Composite dropped 54.04 points, or 0.68%, to 7,889.28.
The pan-European STOXX 600 index lost 1.65% and MSCI's gauge of stocks across the globe shed 0.89%.
Previously Beijing said it would retaliate if the tariff hike is implements while Trump had insisted China "broke the deal."
"Investors are worried about the clash of the titans," said Joseph Quinlan head of market strategy for Merrill and Bank of America Private Bank in New York.
"It's the knock-on effect on the rest of the world in terms of potential disruptions to global supply chains, the decline in investor confidence, business confidence and consumer confidence. And we're getting closer to striking midnight."
U.S. Treasury yields came off their session lows partly due to Trump's latest trade comments but also because traders were preparing for a bond auction.
Benchmark 10-year notes last rose 8/32 in price to yield 2.4547%, from 2.483% late on Wednesday.
In currencies, the yen had surged to a three-month high against the dollar and the Swiss franc was at a one-month high as investors, eyeing escalating trade conflict, sought out the safe currencies.
The greenback also eased some declines. It was last down 0.4% against the yen.
The dollar index fell 0.26%, with the euro up 0.3% to $1.1225.
Spot gold added 0.3% to $1,284.71 an ounce.
U.S. crude fell 0.82% to $61.61 per barrel.
Emerging market stocks lost 2.05%.
Additional reporting by Kate Duguid, Richard Leong in New York, Marc Jones in London, Tomo Uetake in Sydney, Noah Sin in Hong Kong; editing by Dale Hudson, John Stonestreet and Jonathan Oatis