* Report says Trump proceeding with tariffs on China
* Emerging market stocks rise after Turkey rate hike
* Oil rises, helping energy shares (Updates with forthcoming U.S. tariffs on China)
By Trevor Hunnicutt
NEW YORK, Sept 14 (Reuters) - A world stock index climbed as bank and energy shares rose on Friday, but the momentum was sapped by a report that Washington may fire a new salvo in its trade dispute with Beijing.
U.S. President Donald Trump has directed aides to place U.S. tariffs on about $200 billion of Chinese goods, according to a person familiar with the matter. Bloomberg News first reported Trump's action.
That news deflated the confidence of investors, who earlier pushed the MSCI All-Country World index .MIWD00000PUS , which tracks shares in 47 countries, to its highest level since Sept. 4. The index last rose 0.12 percent on the day.
On Wall Street, financial shares were helped by higher rates, which are seen to benefit banks, which can charge higher interest. Energy stocks got a boost from rising oil prices.
The Dow Jones Industrial Average .DJI fell 74.57 points, or 0.29 percent, to 26,071.42, the S&P 500 .SPX lost 7.54 points, or 0.26 percent, to 2,896.64 and the Nasdaq Composite .IXIC dropped 29.94 points, or 0.37 percent, to 7,983.77.
Benchmark 10-year Treasury notes US10YT=RR briefly hit the psychologically significant 3 percent level for the first time in more than a month as prices on U.S. government bonds fell on economic data that seems solid enough to support plans by the Federal Reserve to raise rates another two times in 2018. crude CLcv1 rose 0.82 percent to $69.15 per barrel and Brent LCOcv1 was last at $78.34, up 0.2 percent on the day. O/R The United States is renewing sanctions on Iran, a major oil producer, after withdrawing from a nuclear deal forged in 2015 between Tehran and world powers.
The dollar index .DXY rose 0.41 percent. The greenback has been a safe haven from setbacks on the trade issue.
Copper, used heavily by China, lost 1.82 percent to $5,923.50 a tonne. CMCU3 The Chinese yuan traded offshore CNH=D3 slipped to 6.88 per dollar from a high of 6.84 earlier in the session.
Chinese shares earlier had retreated as data showed real estate investment in the country fell in August, raising concern that a cooling property market could increase risks for Beijing's economic outlook as the trade environment worsens. the potential for a trade deal in the near-term remains low, a resumption of dialogue could lift sentiment and support markets," analysts at Credit Suisse (SIX:CSGN) wrote in a note to clients.
RATE HIKE LIFTS LIRA
A sharp interest rate increase by Turkey's central bank to support a tumbling lira boosted emerging markets. The bank hiked its benchmark interest rate TRINT=ECI by more than one-third, to 24 percent. crises in both Turkey and Argentina have stoked fears of contagion over the past several weeks, hammering emerging market assets from Indonesia and India to South Africa.
Turkish lira TRYTOM=D3 implied volatility gauges fell to their lowest in more than a month, as sentiment continued to improve. bold decision (by Turkey's central bank) reduces the risk that a full-scale financial crisis may unfold," analysts at Rabobank wrote in a note to clients.
"The central bank's efforts must be accompanied by an implementation of constructive macro prudential policies by the administration."
Emerging market stocks tracked by MSCI .MSCIEF rose 0.85 percent.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Emerging market currencies battered
https://reut.rs/2p8rvKO World FX rates in 2018
http://tmsnrt.rs/2egbfVh
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