GLOBAL MARKETS-European bank rebound not enough to save world stocks from further losses

* World stocks down for third day in a row

* Investors nervous over central banks

* HSBC, SocGen (Paris: FR0000130809 - news) lift European financials

By Jamie McGeever

LONDON, Aug 3 (Reuters) - World stocks fell for a third straight day on Wednesday, depressed by growing nervousness surrounding central bank policy and the spike in world bond yields, although European bank shares rebounded after two major earnings reports.

Japanese stocks led the way, pushed down nearly 2 percent by a surge in Japanese government bond yields and the strength of the yen, and European shares slid to fresh three-week lows.

Shares (Berlin: DI6.BE - news) in banks HSBC and Societe Generale (Swiss: 519928.SW - news) rose as much as 5 percent after reporting second quarter earnings, a glimmer of light for the region's financials amid the recent gloom.

But that failed to lift the broader European indexes and U.S (Other OTC: UBGXF - news) . futures pointed to a softer open on Wall Street.

"Earnings have not been too bad, but I remain bearish on the markets. A lot of companies in Europe are beating estimates, but if you look at the results, most of the companies are not actually growing their sales or profits," said Terry Torrison, managing director at Monaco-based McLaren Securities.

Europe's index of leading 300 shares was flat at 1,321 points after trading as low as 1,316 points and Germany's DAX was also unchanged at 10,141 points.

Financials rose more than 2 percent at one stage, lifted by SocGen and HSBC after their respective earnings reports. SocGen profits beat expectations and HSBC announced a $2.5 billion share buyback plan.

MSCI (NYSE: MSCI - news) 's global share index fell 0.4 percent for its third straight decline, a run not seen since early June. Japan's Nikkei fell 1.9 percent.

In bond markets, yields were little changed on the day, but still well up from recent lows following the shakeout in debt markets globally since the Bank of Japan's policy meeting last Friday and as eyes turn to the Bank of England on Thursday.

"Investors are slowly realising that with every spin of the central bank policy chamber the magazine is getting emptier," said Michael Hewson, chief market analyst at CMC Markets (LSE: CMCX.L - news) in London.

BOE TEST AWAITS

While Japanese bonds steadied on Wednesday they have suffered the worst sell-off in over three years as investors feared the BoJ was out of easing ammunition and might leave it to fiscal policy to stimulate the economy.

UK services sector data on Wednesday showed the wider economy is shrinking at the fastest pace since 2009, upping the ante on the Bank of England not to under-deliver at its policy meeting on Thursday.

"There's so much assumption that the Bank will cut rates that even though the effect of that will be minimal, they will do it, because not doing it would have an adverse effect on their credibility," former BoE (Shenzhen: 200725.SZ - news) policymaker Charles Goodhart told Reuters.

"(But) I would vote for no change in rates or QE (quantitative easing)," Goodhart said, adding the Bank has effectively run out of policy ammunition and further stimulus would be ineffective.

The 10-year UK gilt yield was unchanged at 0.80 percent and the comparable Bund yielded -0.4 percent , both up around 10 basis points so far this week.

Benchmark 10-year U.S. Treasuries were also little changed on the day at 1.54 percent, and also up around 10 basis points this week, even though domestic data has generally been soft.

The recent outbreak of weaker U.S. data has further pushed back expectations for when the Federal Reserve might hike rates - the market is not fully priced for a move until well into 2018 - and taken a heavy toll on the dollar.

The dollar touched a near six-week trough against a basket of currencies before recovering, while the euro reached its highest since mid-July around $1.1230 before easing back below $1.12.

Against the yen, the dollar was higher at 101.13 yen having got as low as 100.75 yen.

In commodities, oil prices recovered but remained vulnerable to worries about a glut in both crude and refined product.

Brent crude rose 0.5 percent to $42.01 but remained near four-month lows reached on Wednesday. NYMEX crude rose 0.6 percent to $39.75 a barrel, but was still under the psychological $40 level.

(Reporting by Jamie McGeever and Sudip Kar-Gupta; Editing by Janet Lawrence)