* World shares set to snap seven days of gains
* Bayer, FedEx weigh on stocks in Europe, Wall Street
* Sterling falls as much as 0.9 pct to the dollar (Updates prices, comments, changes dateline from previous LONDON)
By Rodrigo Campos
NEW YORK, March 20 (Reuters) - World share markets looked poised to end their longest winning streak of the year on Wednesday, ahead of a U.S. Federal Reserve monetary policy decision that may offer clues to interest rate prospects for the rest of the year, while oil prices surged after a large draw in U.S. inventories surprised markets.
Sterling tumbled after Britain requested a shorter-than-expected delay for Brexit.
Reports of renewed tension in U.S.-China trade talks weighed on Asian stocks, while news on Bayer and FedEx dragged on equity markets in Europe and Wall Street.
Shares of chemicals group Bayer AG were down 11 percent, on track to post their largest daily drop in 16 years, after a second U.S. jury ruled its Roundup weedkiller caused cancer. FedEx fell 5 percent after it cut its 2019 profit forecast for the second time in three months.
The MSCI gauge of global stocks shed 0.35 percent, and was poised to close lower for the first session in eight.
On the top of investors’ minds, the U.S. central bank, which is winding up a two-day policy meeting, is expected to leave rates unchanged and cut the number of interest rate increases projected for the rest of the year.
Traders now expect no rate increases this year and some are even building in bets for a cut in 2020.
Peter Cardillo, chief market economist at Spartan Capital Securities in New York, said investors would scrutinize the Fed’s statement for signs of how patient it will be before its next move on rates and its views on the economic outlook.
“We believe the Fed will not surprise the markets but add another caveat, a trade deal, to data dependence and patience,” he said.
U.S. crude prices surged to a four-month high after U.S. government data showed tightening oil and product supplies, but gains were capped by concerns over global economic growth amid the ongoing U.S.-China trade dispute.
U.S. crude rose 1.19 percent to $59.73 per barrel and Brent was last at $68.20, up 0.87 percent.
China-U.S. trade talks are set to resume next week - the first since American President Donald Trump delayed a March 1 deadline to raise tariffs on Chinese imports - in a bid to end an eight-month trade war between the world’s two largest economies.
Japan’s government downgraded its assessment of the economy in March for the first time in three years, blaming the U.S.-China trade war for slumping exports and industrial output.
Japan’s Nikkei edged up 0.20 percent.
On Wall Street, the Dow Jones Industrial Average fell 78.68 points, or 0.3 percent, to 25,808.7, the S&P 500 lost 8.1 points, or 0.29 percent, to 2,824.47 and the Nasdaq Composite dropped 11.20 points, or 0.14 percent, to 7,712.75.
The pan-European STOXX 600 index lost 0.68 percent and emerging market stocks lost 0.20 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.26 percent lower.
In currency markets, sterling fell as much as 0.93 percent against the U.S. dollar after British Prime Minister Theresa May asked the EU to delay Brexit until June 30 - a shorter extension than some in the market had been expecting - and warned a no-deal Brexit was still possible.
The pound was last trading at $1.3197, down 0.53 percent on the day.
The dollar index rose 0.03 percent, with the euro up 0.07 percent to $1.1357.
The Japanese yen weakened 0.04 percent versus the greenback at 111.44 per dollar.
Treasury yields fell as the Fed’s policy meeting wound down, with a statement expected at 2 p.m. EDT (1800 GMT).
Benchmark 10-year notes last rose 7/32 in price to yield 2.5889 percent, from 2.612 percent late on Tuesday.
The 30-year bond last rose 13/32 in price to yield 3.0055 percent, from 3.026 percent late on Tuesday.
Spot gold dropped 0.2 percent to $1,303.99 an ounce. Copper rose 0.06 percent to $6,463.00 a tonne.
Reporting by Rodrigo Campos, additional reporting by Medha Singh in Bengaluru and Stephanie Kelly, Kate Duguid; Editing by Bernadette Baum