* Stocks drop as global recession fears build
* Beijing seen at risk of lockdown
* Macron election win relief short-lived for euro
* Oil tumbles back toward $100 a barrel
* Twitter shares jump on Musk takeover talk
* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh (Adds comment, WASHINGTON dateline, byline, updates prices throughout)
By Chris Prentice and Marc Jones
WASHINGTON/LONDON, April 25 (Reuters) - Traders ditched riskier assets on Monday as relief over Emmanuel Macron's victory in the French presidential election quickly gave way to renewed concerns about rising global interest rates and China's spluttering economy.
Wall Street extended last week's sharp sell-off as fears over China's COVID-19 outbreaks spooked investors already worried about faster U.S. interest rate hikes denting economic growth.
Asian markets had suffered their worst day in over a month overnight on fears that Beijing was about to go back into a COVID-19 lockdown, and as Friday's 2.5% Wall Street slump lingered on U.S. futures markets.
Despite relief that Macron had eased past far-right challenger Marine Le Pen on Sunday, Europe's STOXX 600 index fell back to mid-March lows, weighed down by 1.5% and 1.0% drops in French and German shares, respectively.
The Dow Jones Industrial Average fell 403.29 points, or 1.19%, to 33,408.11, the S&P 500 lost 53.39 points, or 1.25%, to 4,218.39 and the Nasdaq Composite dropped 55.13 points, or 0.43%, to 12,784.17 by 11:09 a.m. EST (1509 GMT)
"Stocks' rebound from the first quarter correction has hit a wall of rising long-term interest rates," Morgan Stanley's Chief Investment Officer Lisa Shalett said in a note.
"With the Fed talking about a faster and larger balance sheet reduction than anticipated, real yields are approaching zero from their deeply negative territory. With the nominal 10-year US Treasury cracking 2.9%, the equity risk premium has plummeted."
MSCI's benchmark for global equity markets fell 1.42%. Emerging markets stocks fell 2.83%.
The euro slid as much 0.93% to its lowest since the initial COVID panic of March 2020.
"The reality is there is more to the French election story than Macron's win yesterday," said Rabobank FX strategist Jane Foley.
Not only are there parliamentary elections still to come in France in June, but Macron also seems likely to keep the pressure up for a Europe-wide ban on Russian oil and gas imports, which would cause serious economic pain, at least in the short term.
"We had German officials saying last week that if there was an immediate embargo of Russian energy then it would cause a recession in Germany. And if there was a recession in Germany, that would drag the rest of Europe down and have knock-on effects for the rest of the world," Foley said.
Beijing worries saw the yuan skid to a one-year low.
State television in China had reported that residents were ordered not to leave Beijing's Chaoyang district after a few dozen COVID cases were detected over the weekend.
The dollar index rose 0.702%. The U.S. dollar climbed unhindered to a two-year high and touched a peak of $1.0695 against the euro.
Much focus on is on how fast and far the Federal Reserve will raise U.S. interest rates this year and whether that, along with all the other current global strains, will help tip the world economy into recession.
This week is also a packed one for corporate earnings. Almost 180 S&P 500 index firms are due to report. Big U.S. tech will be the highlight, with Microsoft and Google on Tuesday, Facebook on Wednesday and Apple and Amazon on Thursday.
In Europe, 134 of the Stoxx 600 will also put out results, including banks HSBC, UBS and Santander on Tuesday, Credit Suisse on Wednesday, Barclays on Thursday and NatWest and Spain's BBVA on Friday.
"I wonder whether just meeting expectations will be enough, it just feels like maybe we'll need a bit more," said Rob Carnell, ING's chief economist in Asia, referring to jitters about big tech following a dire report from Netflix last week.
Twitter shares rose amid reports the company was set to accept Tesla-owner Elon Musk's offer to buy the microblogging site.
Friday had seen the Dow Jones suffer its worst day since October 2020 and the CBOE volatility index, dubbed Wall Street's "fear gauge", continue to drive higher on Monday. It has now risen 50% in the last few days.
Monday's earlier selloff in Asia also saw Hong Kong's Hang Seng fall 3.7% and the Shanghai composite index slide over 5%.
China's central bank had fixed the mid-point of the yuan's trading band at its lowest level in eight months, seen as an official nod for the currency's recent slide, and the yuan was sold further, to a one-year low of 6.5092 per dollar.
The higher dollar pushed spot gold 1.8% lower. Palladium prices shed nearly 13% on worries over a hit to Chinese demand.
Elsewhere in commodities, oil prices tumbled with Brent crude down 5.19% and U.S. crude down $5.3%.
U.S. Treasury and euro zone bond yields were also down.
Money markets are now pricing in a 1 percentage point increase in U.S. interest rates at the Federal Reserve's next two meetings and at least 2.5 points for the year as a whole, which would be one of the biggest annual increases ever.
This week will also see the release of U.S. growth data, European inflation figures and a Bank of Japan policy meeting, which will be watched for any hints of a response to a sharp fall in the yen, which has lost 10% in about two months.
(Additional reporting by Tom Westbrook in Singapore; Editing by Bernadette Baum, Catherine Evans and Mark Heinrich)