September 4, 2018 / 4:26 PM / 19 days ago

GLOBAL MARKETS-Emerging markets under pressure as dollar rises

* Wall Street falls as worries about U.S. trade tensions persist

* Dollar rise sends euro, emerging market currencies lower

* South Africa's rand slumps as data shows recession

* Oil climbs as Gulf rigs prepare for hurricane

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* (Updates after U.S. open, adds commentary, byline change, previous dateline LONDON)

By Sinéad Carew

NEW YORK, Sept 4 (Reuters) - Stocks tumbled in many major markets around the world on Tuesday, while emerging markets currencies fell and the U.S. dollar rose as investors looked for safety as they braced for escalation in the trade conflict between the United States and China.

Oil prices rose as Gulf of Mexico rigs were evacuated in preparation for a hurricane.

Emerging markets stocks and currencies were under added pressure on concerns about inflation in Turkey, and after data showed South Africa had slumped into recession in the second quarter.

U.S. Treasury yields rose as investors prepared for heavy corporate debt supply, and as falling Italian debt yields reduced safety demand for U.S. government debt.

The public comment period on a U.S. proposal for new tariffs on Chinese goods is set to end on Thursday. U.S. President Donald Trump can then follow through on plans to impose levies on $200 billion more of Chinese imports.

U.S.-Canada trade talks ended on Friday with no deal to revamp the North American Free Trade Agreement (NAFTA) after Trump told Congress he would sign a bilateral trade pact with Mexico.

"My sense would be Trump is focused on Mexico, but he is not in any mood to compromise on Canada, Europe or China," said Marc Chandler, global head of currency strategy at Brown Brothers Harriman in New York.

The Dow Jones Industrial Average fell 88.02 points, or 0.34 percent, to 25,876.8, the S&P 500 lost 11.15 points, or 0.38 percent, to 2,890.37 and the Nasdaq Composite dropped 45.95 points, or 0.57 percent, to 8,063.59.

The pan-European FTSEurofirst 300 index lost 0.75 percent. MSCI's gauge of stocks across the globe shed 0.63 percent for its biggest one-day decline since August 15, weighed down by declines in Wall Street's major indexes and a drop in European stocks after China closed higher.

MSCI's emerging market stocks index was down 0.7 percent and on track for its fifth straight day of declines.

In currencies, the South African rand ZAR= was last down 2.7 percent against the dollar, while Turkey's Lira was last down 1 percent.

The Canadian dollar weakened to a six-week low against its U.S. counterpart amid an uncertain outlook for Canada's trading arrangement with the United States. The Canadian dollar fell 0.72 percent versus the greenback at 1.32 per dollar.

A JPMorgan emerging market currency index fell to its lowest since May 2017. The Turkish lira TRY=D3 and the Mexican peso MXN=D3 also slipped against the dollar.

"We are just waiting for something to turn the EM (emerging market) sentiment because the valuations look really attractive, but it's just a slow meltdown at the moment," said Standard Life Aberdeen EM portfolio manager Viktor Szabo.

Benchmark 10-year notes last fell 14/32 in price to yield 2.904 percent, from 2.853 percent late on Friday.

The 30-year bond last fell 37/32 in price to yield 3.0673 percent, from 3.009 percent late on Friday.

Oil prices rose on Tuesday after the evacuation of two Gulf of Mexico oil platforms in preparation for tropical storm Gordon, which was expected to come ashore as a hurricane.

U.S. crude rose 0.47 percent to $70.13 per barrel and Brent was last at $78.36, up 0.27 percent on the day. (Additional reporting by Saqib Iqbal Ahmed, Karen Brettell, in New York, Mark Jones in London, Abhinav Ramnarayan and Saikat Chatterjee Editing by Catherine Evans and Bill Berkrot)

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