GLOBAL MARKETS-Euro hit, stocks down on debt fears, Fed talk

* Euro drops as finance ministers meet

* U.S. Treasuries supported by Bernanke remarks

* Oil, commodities cling on to gains (Updates with U.S. markets open, changes byline, dateline, previous LONDON)

By Manuela Badawy

NEW YORK, Dec 6 (Reuters) - The euro fell sharply against the dollar on Monday and stocks dipped as fears remained over sovereign debt problems in Europe.

U.S. Treasuries rose prompted by safe-haven bids after Federal Reserve Chairman Ben Bernanke said on Sunday the Fed may buy more than the $600 billion in U.S. government bonds it has committed to purchase, if the economy failed to respond. [ID:nN05271909]

Oil and gold prices held near its highest in two years and since mid-November respectively.

"The U.S. showed you need to take extremely strong actions to overcome the threat of a broad financial crisis," said Rick Meckler, president of investment firm LibertyView Capital Management in New York.

"The feeling was Europe has only gone about two-thirds of the way, and there was some hope they will go to a full throttle protection plan."

Euro zone finance ministers met on Monday amid pressure to increase the size of a 750 billion euro ($1,006 billion) safety net for debt-stricken members in hopes of halting potential contagion to other countries. For details, see [ID:nLDE6B40EJ]

Stocks and the euro have moved in tandem of late with the euro looked at as a proxy for regional debt concerns.

The Dow Jones industrial average <.DJI> was down 14.57 points, or 0.13 percent, at 11,367.52. The Standard & Poor's 500 Index <.SPX> was down 1.97 points, or 0.16 percent, at 1,222.74. The Nasdaq Composite Index <.IXIC> was down 0.72 points, or 0.03 percent, at 2,590.74.

The pan-European FTSEurofirst 300 index of European shares <.FTEU3>, were flat with optimism that the U.S. Federal Reserve may pump more funds into the economy offset by uncertainty over the result of a meeting of euro zone finance ministers. The MSCI world equity index <.MIWD00000PUS> was down 0.1 percent at 321.81.

Japan's stocks index, The Nikkei <.N225> closed the day down 0.1 percent on profit-taking after they hit a six-month high last week.

EURO UNDER PRESSURE

The euro was down 0.93 percent at $1.3289, its first decline in four sessions, as euro zone finance ministers are put under pressure to increase the size of its rescue fund after an 85 billion euro aid package for Ireland failed to calm markets.

The dollar gained against a basket of currencies, with the U.S. Dollar Index <.DXY> up 0.51 percent at 79.78. Against the Japanese yen, the dollar was up 0.22 percent at 82.80 from a previous session close of 82.620.

An International Monetary Fund report, to be delivered to the meeting in Brussels, will say the euro zone should increase the size of its 750 billion euro rescue fund and the European Central Bank should boost its bond-buying markedly.

U.S. Treasuries rose yet gains were limited as investors prepared for this week's $66 billion in coupon-bearing supply. Traders have also been selling into strength, either to lock in short-term profits or to unwind earlier positions tied to the Fed's latest quantitative easing program, dubbed QE2.

The benchmark 10-year U.S. Treasury note was up 13/32, with the yield at 2.9572 percent. The 2-year U.S. Treasury note was up 1/32, with the yield at 0.4484 percent. The 30-year U.S. Treasury bond was up 19/32, with the yield at 4.2806 percent.

Meanwhile, oil eased from a 26-month high near $90 as the dollar strengthened, countering support from higher demand caused by cold weather in Europe and parts of the United States. Oil and dollar-denominated commodities often move inversely to the dollar.

Crude oil was down 2 cents, or 0.02 percent, to $89.17 per barrel, after trading as high as $89.76, the highest since October 2008, as a cold spell in Europe and in parts of the United States should limit the downside for prices because of greater heating demand.

Spot gold prices rose 36 cents, or 0.03 percent, to $1414.80 an ounce. It touched a record $1,424.10 early in November.

While strength in the U.S. currency kept a lid on further gains in dollar-priced gold, gold hit record highs in sterling terms and Japanese yen-denominated bullion hit its highest since early 1983 as risk aversion stoked broad-based gains in the metal.

(Additional reporting by Leah Schnurr, Richard Leong and Julie Haviv in New York, and Mike Peacock, Alex Lawler and Jan Harvey in London. Editing by W Simon )