Updates to late US afternoon

By Caroline Valetkevitch

NEW YORK, May 21 (Reuters) - Major stock indexes fell on Wednesday as investors worried about a deteriorating U.S. fiscal outlook and as Treasury yields climbed following a $16 billion sale of 20-year bonds by the Treasury Department.

The three major U.S. stock indexes were down more than 1% each following the auction. The dollar also fell broadly.

Treasury yields extended their gains after the U.S. Treasury Department saw soft demand for the $16 billion sale of 20-year bonds. The weak bond sale reinforced the view that investors are shying away from U.S. assets.

At the same time, concerns continued about U.S. President Donald Trump's efforts to push through a tax-cutting bill that could worsen the debt load by $3 trillion to $5 trillion.

Investor sentiment has been fragile since Moody's late last Friday downgraded the United States' credit rating, stoking concerns about the country's $36 trillion debt pile.

Trump tried to get more support from Republicans who object to parts of his tax cut and spending bill. U.S. House of Representatives Speaker Mike Johnson acknowledged a vote by the full chamber may not occur on Wednesday as his Republicans remain divided over the details of the sweeping legislation.

There are also concerns about a lack of progress on U.S. trade talks with trading partners pressing Washington to ease or eliminate its tariffs.

"There's no doubt the (U.S.) deficit has grown larger," said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. "Is there a chance that Trump over his term will bring that down? I would be surprised."

"What we're really in is this period that's sort of a waiting game on tariffs," he added. "Negotiations are going on ... we don't really know if progress is being made."

The Dow Jones Industrial Average .DJI fell 817.23 points, or 1.91%, to 41,860.01, the S&P 500 .SPX fell 95.91 points, or 1.61%, to 5,844.55 and the Nasdaq Composite .IXIC fell 270.07 points, or 1.41%, to 18,872.64.

MSCI's gauge of stocks across the globe .MIWD00000PUS fell 7.93 points, or 0.90%, to 873.69.

European stocks dipped, with British sportswear retailer JD Sports JD.L declining. The pan-European STOXX 600 .STOXX index fell 0.04%.

Bitcoin, meanwhile, hit a record high, eclipsing its previous high from January. It was last up 0.58% at $107,569.81.

The 30-year bond US30YT=RR yield rose 11.5 basis points to 5.0817% from 4.967% late on Tuesday.

The dollar index =USD, which measures the greenback against a basket of currencies including the yen and the euro,

fell 0.36% to 99.60.

Oil prices settled lower, after Oman's foreign minister said a new round of nuclear talks between Iran and the U.S. would take place later this week. Also, the U.S. government released bearish data on crude and fuel supplies.

(Reporting by Caroline Valetkevitch in New York, with additional reporting by Lawrence White in London and Johann M Cherian and Ankur Banerjee in Singapore; Editing by Sharon Singleton, Ed Osmond, Matthew Lewis and Sandra Maler)

((caroline.valetkevitch@thomsonreuters.com))