* Trump threat of more China tariffs hurts stocks
* Equity markets in the red but weakness limited
* Bond yields fall on weak US jobs report, trade spat
By Herbert Lash
NEW YORK, April 6 (Reuters) - Crude prices and global equity markets fell on Friday after U.S. President Donald Trump upped the ante in a trade dispute with China that added to investor jitters about the potential impact the heated rhetoric may have on the world economy.
MSCI's gauge of worldwide stock indexes fell 0.65 percent, and all three major U.S. stock indexes slid more than 1 percent, after Trump threatened late Thursday to slap tariffs on an additional $100 billion of Chinese goods.
China warned it was fully prepared to respond with a "fierce counter strike" of fresh trade measures if the United States follows through on Trump's latest threat. weak U.S. jobs report helped push U.S. Treasury prices higher as the economy created the fewest jobs in six months in March, but the market's main focus was on mounting U.S.-China tensions.
"The jobs report is taking a back seat to the trade discussion and back and forth between the U.S. and China," said Michael Arone, chief investment strategist at State Street Global Advisors in Boston.
"Think of it as a game of poker and (Trump's) raising the stakes a little bit," he said.
The pan-European FTSEurofirst 300 index .FTEU3 closed down a preliminary 0.55 percent and MSCI's gauge .MSCIEF of emerging market stocks lost 0.40 percent.
The Dow Jones Industrial Average .DJI fell 345.64 points, or 1.41 percent, to 24,159.58. The S&P 500 .SPX lost 26.48 points, or 0.99 percent, to 2,636.36 and the Nasdaq Composite .IXIC dropped 60.21 points, or 0.85 percent, to 7,016.34.
Oil prices tumbled, with U.S. crude falling about 2 percent. as China is a large importer of U.S. crude oil.
"The heightened possibility of an outright tariff war is conjuring up images of slowed economic growth that could curtail the strong oil demand that has helped to revive a strong pricing environment during the past couple of months," Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
Brent crude LCOc1 futures fell 98 cents to $67.35 per barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 futures slid $1.21 to $62.33 a barrel.
U.S. Treasury and euro zone government bond yields dipped as the trade spat raised the prospect of a full-blown trade war between the world's two largest economies.
The yield on 10-year German government debt, the euro zone benchmark, dipped 2.7 basis points in late trading to 0.494 percent, erasing much of Thursday's rise DE10YT=RR .
Benchmark 10-year notes US10YT=RR last rose 12/32 in price to push yields down to 2.7881 percent.
The dollar index .DXY , tracking the unit against other major currencies, fell 0.3 percent, with the euro EUR= up 0.25 percent to $1.2268. The Japanese yen JPY= firmed 0.32 percent versus the greenback at 107.07 per dollar.