NEW YORK (Reuters) - Oil prices fell sharply on Monday to touch a one-month low on doubts about OPEC's ability to implement its planned production cut, while global equity prices were shaky as Wall Street struggled to build on a sentiment boost from a string of M&A deals.
Month-end rebalancing and uncertainty over next week's U.S. presidential election helped demand for bonds even as they posted a weak monthly performance.
Oil prices dropped more than 3 percent on skepticism about OPEC's planned production cut, with the market further weighed by expectations that the cartel had record output in October.
"The market is becoming a bit weary," said Kyle Cooper, analyst at ION Energy in Houston. "Unless OPEC can circle the wagons and get everyone on the same page, the market's going to be skeptical."
Brent crude settled down $1.41, or 2.84 percent, at $48.30 a barrel, while U.S. crude settled down $1.84, or 3.78 percent, at $46.86.
Lower oil prices weighed on energy shares on Wall Street and in Europe. MSCI's 47-country "All World" index gave up gains from earlier in the session and was little changed.
A flurry of deal activity that included General Electric's merger of its oil and gas business with Baker Hughes Inc and CenturyLink's acquisition of Level 3 Communications failed to boost Wall Street shares.
Investors remained cautious about taking large positions ahead of the outcome of the U.S. election.
"The potential for volatility is high and that keeps people worried," said Scott Fullman, chief strategist at Revere Securities LLC.
Stocks were jolted on Friday by disclosure that the FBI was investigating more emails as part of a probe of Hillary Clinton's use of a private email system, causing fresh uncertainty over the Democratic candidate's presumed lead in the presidential election over Republican rival Donald Trump.
The Dow Jones industrial average fell 18.77 points, or 0.1 percent, to end at 18,142.42, the S&P 500 lost 0.26 point, or 0.01 percent, to finish at 2,126.15 and the Nasdaq Composite dropped 0.97 point, or 0.02 percent, to end at 5,189.14.
European equities fell for a sixth straight session, with energy shares tracking weaker crude oil prices and financial stocks losing ground. Europe's broad FTSEurofirst 300 index closed down 0.55 percent at 1,338.50. [
Benchmark U.S. Treasuries ended their worst month in almost two years after falling expectations of central bank accommodation sent sovereign debt yields higher globally this month and made U.S. bonds less attractive to foreigners.
Benchmark 10-year notes were up 4/32 in price to yield 1.83 percent, down from 1.85 percent late Friday.
The U.S. dollar surrendered gains to trade little changed against a basket of major currencies on renewed concerns about how the FBI probe might impact the election.
"People want to take a look at the political polls to make sure that the consensus view that Hillary wins is still valid," said Steven Englander, global head of G10 FX strategy at Citigroup in New York.
The greenback fell the most in more than seven weeks on Friday following news that the FBI is reviewing fresh evidence in its probe of the Democratic presidential candidate.
A Clinton win is generally seen by analysts as likely to be a positive for the dollar, and the FBI announcement gave new hope to Trump that he can beat her on Nov. 8.
The dollar index was up 0.08 percent at 98.422.
Gold steadied, coming off lows as the dollar pared gains. Spot gold prices were down 0.04 percent to $1,2275.42.
Additional reporting by Sam Forgione in New York and Tanya Agrawal in Bengaluru; Editing by Bernadette Baum and Dan Grebler