* Dollar index at lowest since February
* Stocks slide, but U.S. equity market on track for positive September
* Brent hovers at $108 a barrel on worries of U.S. shutdown
By Herbert Lash
NEW YORK, Sept 30 (Reuters) - Global stock markets fell and the dollar dropped against major currencies on Monday as a partial U.S. government shutdown loomed, with passage of an 11th hour stop-gap spending bill seen as unlikely.
The Democrat-controlled U.S. Senate was poised to reject a Republican funding measure that would delay "Obamacare" health reforms. A simple majority vote was scheduled for shortly after 2 p.m. that would strip Republican amendments and send a "clean" funding bill back to the House of Representatives.
House Speaker John Boehner showed no sign of backing down from Republican insistence on linking a funding bill to a delay in President Barack Obama's signature health care law.
If a funding deal were reached soon, markets might recover, but a prolonged shutdown could have a major impact on the economy and consumer confidence. As many as 1 million U.S. federal employees could face unpaid furloughs or payless pay-days.
"The size of the sell-off is logical given the stakes," said Nicholas Colas, chief market strategist at the ConvergEx Group in New York.
The dollar fell 0.45 percent against a basket of six major currencies and 0.27 percent against the yen, trading at 97.97. The euro rose 0.08 percent at 1.3532.
MSCI's all-country equity stock index was down 0.73 percent, while the broad FTSEurofirst 300 index of regional shares was down 0.65 percent at 1,246.38.
The Dow Jones industrial average was down 106.70 points, or 0.70 percent, at 15,151.54. The Standard & Poor's 500 Index was down 9.52 points, or 0.56 percent, at 1,682.23. The Nasdaq Composite Index was down 14.12 points, or 0.37 percent, at 3,767.48.
Wall Street has weathered similar incidents in the past. During a shutdown from Dec. 15, 1995, to Jan. 6, 1996, the S&P 500 added 0.1 percent. During the Nov. 13 to Nov. 19, 1995 shutdown, the benchmark index rose 1.3 percent, according to data by Jason Goepfert, president of SentimenTrader.com.
That precedent may not hold this time, given that economic growth continues to be weak. Wall Street may also be ripe for a sell-off, with the S&P near an all-time high after having escaped any sustained pullback so far this year.
Economic data showed the Chicago Purchasing Managers index rose more than expected in September, climbing to 55.7 from 53 the previous month. Analysts were expecting a reading of 54.
U.S. Treasuries prices fell, with the benchmark 10-year U.S. Treasury bond off 3/32 in price to yield 2.639 percent.
"The best way to say what the market is doing right now is that it's pricing in a partial government," said John Herrmann, director of interest rates strategy at Mitsubishi UFJ Securities in New York.
Brent crude oil fell, heading for its first monthly decline since May, as the looming U.S. government shutdown clouded the outlook for demand, while tensions over Iran continued to ease.
Brent was down 48 cents to $108.15 a barrel. U.S. crude was down $1.10 at $101.77 a barrel.