Global Markets - Wall Street's two major indexes drop; oil falls

By Sinead Carew

NEW YORK (Reuters) - Major U.S. stock indexes lost ground on lacklustre earnings reports on Tuesday, while oil fell on concerns about U.S. crude stockpiles and Saudi Arabia's announcement that it ended its military campaign in Yemen.

European and other markets moved higher, and currency trading was choppy.

The Nasdaq composite index was the brightest spot in U.S. stock markets. It gained 0.4 percent, helped by a $40 billion biotechnology acquisition proposal.

But many investors held back as they waited for more quarterly reports and 2015 forecasts, said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

"There's no clear trend," said Forrest. "We haven't seen much change in forecasts for the remainder of the year."

Teva Pharmaceutical Industries Ltd. made an unsolicited bid to buy smaller rival Mylan NV , sending the Nasdaq Biotechnology <.NBI> index up 1.8 percent.

The Dow Jones industrial average fell 85.34 points, or 0.47 percent, to 17,949.59, the S&P 500 lost 3.11 points, or 0.15 percent, to 2,097.29 and the Nasdaq Composite added 19.50 points, or 0.39 percent, to 5,014.10.[.N]

Oil prices fell on the Saudi news and anticipation of a weekly build in U.S. crude stockpiles. A preliminary Reuters survey showed that U.S. crude inventories likely rose by 2.4 million barrels last week.

Positioning ahead of the expiry of the front-month contract in U.S. crude also accounted for a lot of the activity, traders and analysts said.

Brent crude settled down 2.16 percent to $62.08 per barrel but was still up 13 percent from the start of the month. U.S. crude contracts for May, which expire on Tuesday, settled down 1.99 percent at $55.26, but were still up about 16 percent so far this month. [O/R]

The dollar was mixed against major currencies. The euro gained slightly after euro zone finance ministers moved away from fixing a deadline for Greek fiscal reforms.

The euro had pared its gains later in the day after falling earlier against the dollar on a report that European Central Bank staff had proposed to increase the insurance it would demand in return for emergency funding to Greek banks.

The dollar was last up 0.4 percent against the yen at 119.65 yen. The dollar index was up 0.04 percent.

U.S. Treasuries prices fell, adding to the prior day's losses, as some traders pared bullish bets tied to soft domestic data and concerns on whether Greece would hammer out a deal with its creditors before it runs out cash.

"There's not a lot of conviction in either direction for the market," said Justin Lederer, Treasury strategist at Cantor Fitzgerald in New York.

(Additional reporting by Richard Leong and Michael Connor in New York, Editing by Shri Navaratnam, John Stonestreet, Meredith Mazzilli and Dan Grebler)