* World stocks index hits record peak, Europe closes lower
* U.S. dollar bounce loses steam on profit taking
* Wall Street pulls back as banks lag (Adds close of European markets)
By Chuck Mikolajczak
NEW YORK, Feb 16 (Reuters) - A gauge of major world equity markets touched a record high for a second straight day on Thursday, lifted by a round of global data, while a drop in the dollar helped boost U.S. bond prices.
MSCI's All-Country World index hit an intraday record of 444.94, although stocks on Wall Street dipped as the financial sector, down 0.6 percent, lost ground for the first time in six sessions.
In the United States, manufacturing activity in the Mid-Atlantic region surged to its highest in 33 years, housing data indicated a recovery in the sector was on track, and weekly jobless claims pointed to a labor market that continues to tighten.
Other data showed improvements in exports from Indonesia and Taiwan, and falling unemployment in Sweden and the Netherlands.
Still, U.S. equity indexes pulled back after touching another record high, with the benchmark S&P 500 modestly lower after notching its longest winning streak in nearly four years.
"You have got to think the market is tired and needs a little rest here, it's not that stocks are for sale," said Stephen Massocca, Chief Investment Officer, Wedbush Equity Management LLC in San Francisco.
The Dow Jones Industrial Average fell 17.67 points, or 0.09 percent, to 20,594.19, the S&P 500 lost 5.23 points, or 0.22 percent, to 2,344.02 and the Nasdaq Composite dropped 12.74 points, or 0.22 percent, to 5,806.70.
MSCI's benchmark global equity index edged up 0.08 percent to 444.01. Europe's index of leading 300 stocks closed 0.4 percent lower.
The dollar weakened 0.7 percent against a basket of major currencies, retreating further from a one-month high on uncertainty about the timing of the next U.S. interest rate hike from the Federal Reserve.
Expectations for a Fed rate hike in March rose as high as 31 percent after hawkish comments from Fed Chair Janet Yellen on Tuesday, but fed funds futures now imply traders see a 22 percent chance of a hike next month.
The fall in the dollar helped bond prices rally, along with the upbeat economic data. Benchmark 10-year U.S. Treasury notes were last up 17/32 in price to yield 2.4431 percent, down from 2.50 percent late on Wednesday.
"The 10-year can't get through two-and-a-half (percent). It gets bought like crazy every time it gets close to two-and-a-half percent," said Massocca.
Oil prices retreated from earlier highs despite the weakening of the greenback but held in a tight range as the market weighed swelling U.S. inventories against possible renewed efforts by major oil producers to reduce a price-sapping glut.
Brent was last off 0.2 percent at $55.64 after climbing as high as $56.24 a barrel, while U.S. crude was last up 0.4 percent at $53.34 after touching a session high of $53.59.
Gold, up 0.7 percent to $1,240.90 an ounce, was the beneficiary of the weaker greenback along with political uncertainty over U.S. President Trump's policies and upcoming elections in several European Union countries.
Copper lost 1.2 percent to $5,992 a tonne after news China's overseas investment had weakened and sentiment waned over demand in the world's top copper user.
Additional reporting by Richard Leong and Karen Brettell; Editing by Bernadette Baum and James Dalgleish