* U.S. bond prices turn positive, yields down after hitting two-year high
* Wall Street stocks pare losses after China selloff
* Euro turns positive vs dollar, hits session highs
By Angela Moon
NEW YORK, June 24 (Reuters) - Global equity markets and bond prices fell on Monday but stabilized from an earlier selloff as some investors took the weakness as an opportunity to buy, although the U.S. central bank's plans to scale back its bond buying weighed heavily on market sentiment.
Prices on the U.S. 30-year Treasury bond turned positive by late afternoon on Monday, rising to session highs, as buying for bonds, stocks and other assets emerged.
But despite the modest bounce, the 30-year bond yield was not that far below the 22-month high it set earlier due to fears the Federal Reserve might pare its bond purchases later this year and raise short-term interest rates not too long after.
U.S. stocks also recouped losses by late afternoon as U.S. treasury prices rose, but remained down with the S&P 500 off about 0.7 percent.
The euro hit session highs, rallying from nearly three week lows, in tandem with U.S. stocks paring their losses and commodities gaining sharply.
The euro rose as high as $1.3143, recovering from lows of $1.3058, its weakest level since June 5. It was last at $1.3139, up 0.1 percent.
"We're seeing a stemming of the sell-off in risky assets and that has caused some mild profit-taking on the dollar," said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.
The U.S. 30-year Treasury bond last traded up 16/32 in price with a yield of 3.565 percent, down 3 basis points from late on Friday. Earlier, the 30-year yield hit 3.652 percent, an intraday level not seen since August 2011, according to Reuters data.
The shift out of assets that have benefited most from cheap money has been sharpest in the U.S. debt market. The U.S. bond market erased about $390.8 billion in the five days ended June 21, measured by the market value of the BofA/Merrill Lynch Broad Market Index.
During the same period, global equity markets lost more than $1 trillion, based on the market value of the MSCI World Index . The U.S. stock market alone lost about $354.4 billion during the five-day period.
The declines stem from the Federal Reserve's signal last week that the era of cheap central bank money - which caused many assets to hit record highs - was coming to an end. But they have been exacerbated by China's battle to transition to a lower-growth economy.
Both events are unprecedented and have driven a sharp rise in risk aversion among investors fearing a long period of volatility across markets.
Investor sentiment also was hurt by a cash crunch in China, which could further slow Chinese growth. Markets in Shanghai and Hong Kong posted their biggest daily losses in almost four years..
Brent crude at one point fell to its lowest in three weeks and U.S. crude oil slid below its 100-day moving average as investors were worried a credit squeeze in China could dampen economic growth in the world's No. 2 oil consumer.
Gold prices also fell, extending last week's 7 percent slide.
MSCI's benchmark index for stocks in the emerging world fell 1.6 percent, extending losses for a fifth straight day to touch one-year lows.
MSCI's main world equity index, which tracks stocks in 45 countries, shed more than 1 percent to add to last week's 3.2 percent loss, its worst weekly fall since May 2012.
The concerns over China's economic health spread to mining stocks in Europe, adding to worries about the impact of the Fed's tapering and pushing the FTSEurofirst 300 index of top companies down 1.6 percent.
The Euro STOXX 50 Volatility index, known as the VSTOXX, jumped to a nine-month high, signaling a sharp rise in risk aversion among investors.
European equity markets weakened despite data showing German business morale picking up for a second straight month in June, pointing to a slow recovery for Europe's largest economy.