* World stocks edge lower, European shares edge up
* Fresh round of U.S.-China trade tariffs take effect
* Trump threatened by legal woes of two former advisers
* Dollar snaps losing streak after Fed signal Sept rate hike
By Kit Rees
LONDON, Aug 23 (Reuters) - World stocks came under pressure on Thursday as new tariffs took effect in the U.S./China trade war and markets speculated about U.S. President Donald Trump's position following legal rulings against two former advisers.
The MSCI world equity index .MIWD00000PUS , which tracks shares in 47 countries, was 0.1 percent lower by 0822 GMT, while a rise across defensive sectors helped Europe's STOXX 600 .STOXX eke out a 0.1 percent gain.
Stocks were subdued as the U.S. and China, despite ongoing talks, implemented 25 percent tariffs on $16 billion worth of each other's goods. world's two biggest economic powers have now slapped tit-for-tat tariffs on a combined $100 billion of products since early July, with more in the pipeline, adding to risks to global economic growth.
Caroline Simmons, deputy head of the UK chief investment office at UBS Wealth Management, cited such concerns as a reason for paring back an overweight on global equities to a very small position.
"We've got trade conflicts, and sanctions, in Turkey and Russia, so there are a few things going on that we were a little nervous about," Simmons said, though her firm still saw upside to equity markets, with good fundamentals.
The auto sector .SXAP , particularly sensitive to tariff developments, was the worst performing in Europe, down 0.7 percent.
Earlier, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.2 percent. Hong Kong's Hang Seng index .HSI stumbled 0.5 percent while Chinese blue-chips .CSI300 gained 0.4 percent.
LEGAL WOES
While investors are looking ahead to see how increasing trade barriers between China and the United States might affect corporate earnings, political turmoil also weighed.
Trump's former lawyer Michael Cohen pleaded guilty to campaign finance violations on Tuesday and former campaign manager, Paul Manafort, was found guilty on charges of tax and bank fraud.
Investors are considering whether the twin setback will hurt the president and his Republican Party's prospects in mid-term elections. weighed on Wall Street overnight and the market ended mixed despite the S&P500 .SPX clocking its longest bull run in history.
E-Minis for the S&P 500 ESc1 were also subdued, trading 0.1 percent lower.
Cohen's plea deal does not mean the president has been implicated in anything, press secretary Sarah Sanders said at a White House briefing.
"While the (legal issues) shouldn't substantially alter the stock market landscape, money managers and analysts say the developments raise the likelihood of further turbulence ahead for Mr. Trump heading into the mid-term elections," said James McGlew, Perth-based analyst at stockbroking firm Argonaut.
Political tensions were not limited to the United States.
Australian shares .AXJO slipped 0.3 percent after several senior ministers tendered their resignations on Thursday and demanded a second vote on Prime Minister Malcolm Turnbull's leadership. Australian dollar fell 0.8 percent AUD=D3 for its second straight day of declines. BOUNCE
The political uncertainty helped the dollar snap a five-day losing streak, with the greenback in demand after the Federal Reserve suggested that a rate hike for September was on the cards. dollar index .DXY , which measures it against a basket of major currencies, added 0.3 percent to 95.397, pulling off its lowest in three weeks.
The euro EUR= was off 0.4 percent at $1.1556, not far from Wednesday's two-week high of $1.1623. The Japanese yen JPY= weakened 0.2 percent to 110.78 per dollar.
A stronger dollar put pressure on commodities, with Brent crude LCOc1 , the international benchmark, easing to $74.41 while U.S. crude CLc1 also declined to $67.67.
U.S. gold futures GCcv1 for December delivery fell 0.7 percent while spot gold XAU= dipped 0.6 percent to $1,188.16 an ounce. Copper CMCU3 fell 1.5 percent.