(Updates prices, adds lira)
* Bank shares hit by prospect of lower rates
* Focus shifting to Fed minutes, Jackson Hole symposium
* Brent prices reverse to trade higher; WTI little changed
By Rodrigo Campos
NEW YORK, Aug 20 (Reuters) - Traditional safe-havens including the Japanese yen and U.S. Treasuries were sought out on Tuesday even as there were signs that more economic stimulus was on its way, as traders focused on concerns over a global deceleration.
The prospect of new elections in Italy after the announced resignation of Prime Minister Giuseppe Conte added to global uncertainties, but Italian markets have been jittery over infighting within the coalition and Italian yields fell after the announcement.
The key for markets now is whether pledges for more accommodative policy from Germany to China are enough to assuage concerns about the state of the global economy and end fears of recession.
The immediate focus shifts to the minutes of the U.S. Federal Reserve's most recent meeting, due on Wednesday. Traders are also awaiting the Fed's Jackson Hole seminar and a Group of Seven summit this weekend for clues on what additional steps policymakers will take to boost economic growth.
"Market expectations for Jackson Hole and the central banking community in aggregate are extremely dovish," said Brad Bechtel, managing director at Jefferies in New York. "The U.S. market is pricing a tremendous amount of easing now, along with many other markets around the world. The market is literally trying to force the hand of the central banking community."
Weighed by the prospect of even lower interest rates, bank shares were among the largest decliners on Wall Street and in Europe.
The Dow Jones Industrial Average fell 98.13 points, or 0.38 percent, to 26,037.66, the S&P 500 lost 16.38 points, or 0.56 percent, to 2,907.27 and the Nasdaq Composite dropped 38.33 points, or 0.48 percent, to 7,964.48.
The pan-European STOXX 600 index lost 0.68 percent.
MSCI's gauge of stocks across the globe shed 0.30 percent after two sessions of gains over 1%.
Emerging market stocks rose 0.32 percent boosted by overnight gains in South Korea.
The prospect of more central bank easing drove yields lower, Benchmark U.S. 10-year notes last rose 13/32 in price to yield 1.5555 percent, from 1.598 percent late on Monday.
Financial markets went into a tailspin last week after U.S. 2-year yields traded above those of 10-year paper, an inversion that has presaged previous recessions and is widely watched by markets.
The dollar fell against major currencies, in line with the drop in Treasury yields.
The dollar index fell 0.19 percent, with the euro up 0.23 percent to $1.1101.
The Japanese yen strengthened 0.34 percent versus the greenback at 106.29 per dollar, while Sterling was last trading at $1.2169, up 0.36 percent on the day.
The Turkish lira touched its lowest level in nearly a month and recently fell 1.02 percent versus the greenback at 5.73 per dollar after the central bank reduced the required reserves ratio for certain lenders in a move seen as encouraging more loans.
Oil prices rose as stimulus hopes offset concerns over future demand and helped reverse early losses.
U.S. crude fell 0.05 percent to $56.18 per barrel and Brent was last at $59.99, up 0.42 percent on the day.
Spot gold added 0.8 percent to $1,506.44 an ounce on bets on further rate cuts at the Fed and on growth concerns.
Reporting by Rodrigo Campos; additional reporting by Gertrude Chavez-Dreyfuss, Jessica Resnick-Ault and Karen Brettell Editing by Nick Zieminski