GLOBAL MARKETS-Stocks, commodities sink on Irish anxiety, China

* Euro zone talks awaited, markets expect Irish bailout

* World stocks set to fall for seventh straight session

* Possible Chinese tightening weighs on commodities

* For a TAKE A LOOK on Ireland, click on [ID:nLDE68T0MG] (Updates with European markets close)

By Walter Brandimarte

NEW YORK, Nov 16 (Reuters) - World stocks fell for the seventh straight session on Tuesday as growing tensions about Europe's debt problems and expectations of tighter credit in China weighed on commodity prices and hurt investor sentiment.

The U.S. dollar remained at a seven-week high against major currencies as anxiety about the outcome of Ireland's debt crisis sent the euro below $1.35.

Ireland's bond yields rose while euro zone finance ministers discussed in Brussels a solution for the crisis. The officials were weighing a rescue package of 80 billion to 100 billion euros for the country, the Wall Street Journal reported, but Dublin resisted a state bailout, saying that only its banks may need help.

"There's a global concern that if Ireland needs aid, it could become a domino effect with other countries," said Cort Gwon, director of trading strategies and research at FBN Securities in New York.

"Especially at such a sensitive time in the economy to have a setback in Europe could mean a setback for the rest of the world, too."

The premium investors demand to hold Irish government bonds rather than German benchmarks widened to 587.5 basis points from around 562 basis points at Monday's settlement. The cost of insuring against debt default in Ireland, Portugal and Greece also crept higher.

World stocks fell 2.08 percent according to the MSCI All-Country World Index <.MIWD00000PUS>. The index has lost more than 4.0 percent since Nov. 5, when it closed higher for the last time.

In Europe, the FTSEurofirst 300 <.FTEU3> index of top shares ended down 2.3 percent at 1,086.61 points.

The Dow Jones industrial average <.DJI> was down 199.09 points, or 1.78 percent, at 11,002.88, while the Standard & Poor's 500 Index <.SPX> lost 20.86 points, or 1.74 percent, to 1,176.89. The Nasdaq Composite Index <.IXIC> declined 43.73 points, or 1.74 percent, at 2,470.09.

The euro slipped 0.77 percent to $1.3478 as anxiety about Ireland eclipsed a stronger-than-expected reading of German ZEW institute's economic sentiment index.

"What's the driving the euro is just all the sovereign risk out of Europe," said Jack Iles, a portfolio manager at MFC Global Investment Management in Boston. "That's driving sentiment across the board for risk assets and that probably will not go away in the next 48 hours."

The dollar rose 1.0 percent versus a basket of major currencies, according to the U.S. Dollar Index <.DXY>.
Euro zone debt graphic: http://r.reuters.com/hyb65p Ireland's bailout graphic: http://r.reuters.com/wuv48p FX futures positioning: http://r.reuters.com/kus26k ECB bond buy graphic: http://r.reuters.com/zeq88n

CHINESE TIGHTENING

Chinese shares <.SSEC> sank nearly 4.0 percent to a one-month low on reports that China will unveil food price controls and crack down on commodity speculation to contain inflationary pressure. [ID:nL3E6MG081]

The reports increased expectations that China will further tighten monetary policy to help fight inflation. Commodity prices fell as a result, as China is one of the world's top consumers of raw materials.

U.S. crude oil prices lost 2.77 percent to $82.51 per barrel, while spot gold prices fell 1.95 percent, to $1,342.40.

The Reuters/Jefferies CRB Index <.CRB> of commodities futures was down 2.73 percent.

Benchmark 10-year U.S. Treasury yields recovered from Monday's selloff and rose 11/32 in price, sending the yield down to 2.9188 percent.

Investors bought Treasuries again on news that core U.S. producer prices fell unexpectedly in October, supporting the case for the Federal Reserve's program of bond repurchases. (Additional reporting by Ryan Vlastelica, Ellen Freilich and Nick Olivari; Editing by Kenneth Barry)