Oil report

GLOBAL MARKETS-Stocks slide on surging COVID-19 cases, stimulus doubts; dollar rises

* Oil market recovery may take longer than hoped -OPEC official

* Graphic: 2020 asset performance (Updates prices, changes comment)

NEW YORK, Oct 26 (Reuters) - Shares fell across the globe on Monday as surging coronavirus cases in Europe and the United States clouded the world economic outlook, giving the U.S. dollar a safe-haven boost.

The United States, Russia and France set new daily records for coronavirus infections as a resurgence of the virus swelled across parts of the Northern Hemisphere, forcing some countries to impose new curbs.

The spreading pandemic, along with lack of progress on a U.S. stimulus package and caution ahead of the Nov. 3 U.S. presidential election, dragged down the MSCI world equity index .

“It’s almost entirely COVID-related. We thought all along that the most important factor for the market, good or bad, is COVID and it’s bad (today) because cases are rising,” said Christopher Grisanti, chief equity strategist at Mai Capital Management in Cleveland.

“The administration has come out and said it does not want to slow down the economy, yet as cases rise they may not have a choice. So the administration is in a difficult position.”

The Dow Jones Industrial Average fell 767.56 points, or 2.71%, to 27,568.01, the S&P 500 lost 77.75 points, or 2.24%, to 3,387.64 and the Nasdaq Composite dropped 250.24 points, or 2.17%, to 11,298.04.

The pan-European STOXX 600 index lost 1.81% and MSCI’s gauge of stocks across the globe shed 1.78%.

MSCI’s gauge of stocks globally hit a record high in September and brushed against it earlier this month.

Emerging market stocks lost 0.70%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.39% lower, while Japan’s Nikkei fell 0.09%.

Europe became the second region after Latin America to surpass 250,000 COVID-19 deaths on Saturday, according to a Reuters tally, as many European countries reported their highest number of infections in a single day.

Sentiment was also hit by a survey showing German business morale fell in October for the first time in six months.

Reports of progress in a COVID-19 vaccine being developed by the University of Oxford and manufactured by drugmaker AstraZeneca helped limit some of the market sell-off, analysts said.

As markets increasingly price in the likelihood of a Democratic president and Congress which would likely result in a rise in government spending and borrowing, U.S. 10-year Treasury yields hit their highest since early June last week at 0.872%.

“We have raised the probability of a Democratic sweep, already our base case, from 40% to just over 50% and have increased our expectation of (Democratic presidential candidate) Joe Biden to win from 65% to 75%,” NatWest Markets analysts said. “We see steeper U.S. yield curves and a weaker USD as likely to prevail in our base case.”

Benchmark 10-year notes last rose 13/32 in price to yield 0.7993%, from 0.841% late on Friday.

BlackRock Inc, the world’s largest asset manager, on Monday downgraded U.S. Treasuries and upgraded their inflation-linked peers ahead of the U.S. election.

Despite encouraging news about a COVID-19 vaccine out of Oxford, surging coronavirus cases sent investors to the safety of the dollar.

“Skittish investors are scooping up the greenback as virus cases accelerate around the world, stimulus talks in Washington remain in limbo, and trepidation is on the rise ahead of America’s presidential election,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

The dollar index rose 0.26%, with the euro down 0.39% to $1.1813.

The Japanese yen weakened 0.09% versus the greenback at 104.85 per dollar, while sterling was last trading at $1.3025, down 0.12% on the day.

In commodity markets, spot gold added 0.1% to $1,903.00 an ounce. Silver fell 1.17% to $24.29.

Oil prices extended last week’s losses. OPEC’s secretary general said an oil market recovery may take longer than hoped as coronavirus infections rise worldwide, and OPEC and its allies would “stay the course” in balancing the market.

U.S. crude fell 3.56% to $38.43 per barrel and Brent was at $40.32, down 3.47% on the day.

Reporting by Rodrigo Campos; additional reporting by Lewis Krauskopf and Gertrude Chavez-Dreyfuss in New York, Ross Gerber in Boston, Medha Singh in Bengaluru, and Tom Arnold in London; Editing by Mark Heinrich