LONDON/SINGAPORE (Reuters) - Global stocks dipped on Tuesday, while bond yields and the dollar traded near multi-month highs as investors reined in expectations for more big U.S. interest rate cuts ahead of the U.S. election.

Bucking the trend in the equities market was the European heavyweight software company SAP, which surged to an all-time high after raising its full-year targets.

The MSCI All-World index ticked 0.2% lower, while U.S. futures pointed to another weaker start open after Monday's drop in the benchmark indices.

"We're getting very close to the U.S. election and the data in the U.S. has been strong. So there is a question about how much the Fed can do," said Peter Schaffrik, global macro strategist at RBC Capital Markets.

The chances of the U.S. Federal Reserve delivering a quarter-point rate cut at its Nov. 7 meeting have receded to 87% from near certainty a week ago, according to CME's FedWatch tool.

A host of data signalling U.S. economic strength have thrown cold water on bets over another outsized cut, following the Fed's decision to cut rates by half a point in September.

Adding to the uncertainty was the looming U.S. election, where former Republican president Donald Trump and Democrat Vice President Kamala Harris are caught in a tight battle to win over some of the more competitive states ahead of the Nov. 5 voting day.

Trump's lead in online betting polls has aided the dollar's recent rise to a 2-1/2 month high as his proposed tariff and tax policies could mean stronger inflation and keep U.S. interest rates higher for longer.

The dollar index was just below that peak at 103.89.

"As neither party holds a clear advantage in any of the key swing states that could decide the outcome, the race remains too close for pollsters to call, and we expect volatility to pick up in the coming weeks amid elevated uncertainty," said Mark Haefele, chief investment officer, UBS Global Wealth Management.

Political and geopolitical uncertainty kept safe-haven gold pinned near record levels, up 0.6% at $2,735 an ounce.

Benchmark 10-year Treasury yields rose 2 basis points to 4.21%, extending a sharp move higher and hitting their highest since late July. [US/]

ASIA TRADE

Investors also took some cash off the table in Japan, which holds an election on Sunday. Stocks, bonds and the yen have all fallen in tandem as polls have shown the possibility of the ruling coalition losing its majority.

Japan's Nikkei ended down 1.3% to touch its lowest since early October, while the yen hit 151 per dollar for the first time since July. [.T][JP/]

"It's a small capital flight out of Japan," said Naka Matsuzawa, Japan macro strategist at Nomura. More broadly, he said, markets were starting to speculate on a "red sweep", delivering Republicans the White House and Congress in November.

Besides the yen, foreign exchange markets steadied after a session of selling almost everything against the dollar. The Australian and New Zealand dollars were each up about 0.4% on the U.S. dollar while the euro and sterling rose 0.1%. [FRX/]

The move pushed sterling just below $1.30, though traders are wary as Bank of England Governor Andrew Bailey is due to speak at 1325 GMT and has recently suggested the central bank can move more aggressively to cut interest rates.

China's markets were pinned well below recent highs, while traders wait for more details and especially more government urgency and spending to support the ailing economy.

Oil prices also steadied and Brent crude futures traded at $74 a barrel, down 0.3% on the day.. China's oil-demand growth is expected to remain weak in 2025, the head of the International Energy Agency said on Monday.

A relatively bare data calendar puts extra focus on U.S. earnings for insight into the economy and markets' mood.

General Motors, Texas Instruments Verizon, Lockheed Martin and 3M are among those reporting on Tuesday.