* Global stocks fall as Trump threatens new tariffs
* Emerging currencies set for 5th straight month down against USD (Updates to U.S. equity market open; changes dateline, previous LONDON)
By Trevor Hunnicutt
NEW YORK, Aug 31 (Reuters) - Global stocks were poised on Friday to end August much as they began the month - under the dark cloud of a potentially worsening trade war.
A closely watched barometer of global equities fell for a second day as a report that U.S. President Donald Trump was preparing to step up a trade war with Beijing dampened risk appetite and erased some gains from a rally this week.
Trump is ready to impose tariffs on another $200 billion in Chinese imports as soon as a public comment period on the plan ends next week, Bloomberg News reported on Thursday. The White House declined to comment.
Trump in an interview with Bloomberg also threatened to withdraw from the World Trade Organization if "they don't shape up," a move that would further undermine one of the foundations of the modern global trading system.
"It's very hard to see a decisive resuscitation of risk appetite until these tensions are resolved," said Paul O'Connor, head of the multi-asset team at Janus Henderson Investors.
"We have learned to under-react to some of the individual headlines because if you try to extrapolate from any of them you could find yourself in big trouble."
The MSCI All-Country World Index, which measures stocks in 47 countries, shed 0.10 percent for the day, but was set for a 0.6 percent gain for the month.
The modest rise masked a growing chasm between the haves and the have-nots. The S&P 500, which includes large U.S. companies, is up 3 percent for the month, while the MSCI Emerging Markets index is down about the same.
On Friday the Dow Jones industrial average rose 29.53 points, or 0.11 percent, to 26,016.45, the S&P 500 gained 4.18 points, or 0.14 percent, to 2,905.31 and the Nasdaq Composite added 29.70 points, or 0.37 percent, to 8,118.06.
Trade anxieties boosted both the dollar, seen as a short-term winner if the United States spends less on imports, and the safe-haven yen. The dollar index rose 0.15 percent while the Japanese yen strengthened 0.07 percent versus the greenback.
The Mexican peso gained 0.29 percent versus the U.S. dollar and the Canadian dollar fell 0.47 percent. Each country is party to the North American Free Trade Agreement with the United States.
While Mexico has negotiated a deal with the United States on Monday, U.S. and Canadian officials were making a final push to iron out differences ahead of a Friday deadline set by Trump.
Canadian officials expressed concern that a deal will not be concluded on Friday, Canada's Globe and Mail reported, citing a source familiar with situation.
Emerging market currencies showed needed signs of stability even as they were set to post their fifth straight month of losses in dollar terms. The index of those countries' currencies rose 0.06 percent on Friday.
Currencies in two particularly troubled economies, Turkey and Argentina , strengthened against the dollar.
The Turkish government said it will lower the level of withholding tax on lira bank deposits, while raising it on foreign currency deposits. Meanwhile, in Argentina, investors expect further government spending cuts to be announced on Monday.
In Asia, the Indonesian rupiah fell to a nearly three-year low and approached levels not seen since the 1990s Asian financial crisis even as the country's central bank said it was "decisively" intervening to support the currency. The Indian rupee hit a record low.
Reporting by Trevor Hunnicutt; Additional reporting by Ritvik Carvalho and Helen Reid in London and Hideyuki Sano in Tokyo; Editing by Jeffrey Benkoe