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GLOBAL MARKETS-Stocks fall with tobacco shares, Amazon; oil climbs

* Amazon results pull global stocks away from highs

* Dollar falls against the euro (Updates with U.S. markets; changes byline, dateline; previous LONDON)

NEW YORK, July 28 (Reuters) - Global stock markets fell on Friday as tobacco shares dropped and Amazon earnings disappointed, while oil prices added to recent gains and were on track for their biggest weekly percentage rise this year.

The U.S. Food and Drug Administration said it aims to reduce nicotine levels in cigarettes while exploring measures to shift smokers towards e-cigarettes.

Altria Group shares fell 9.5 percent and were the biggest drag on the S&P 500, followed by Amazon. Shares of British American Tobacco were down 6.8 percent and British peer Imperial Brands were down 3.8 percent.

Amazon's stock fell 2.6 percent after it reported results late Thursday. Amazon is one of the "FANG" group of companies, along with Facebook, Netflix and Google, that have supported U.S. stocks' gains this year.

Tech shares, which fell on Thursday, were down 0.1 percent on Friday.

"Investors are still feeling some weakness in the tech sector and that's weighing on the broader market," said Robert Pavlik, chief market strategist at Boston Private Wealth.

The Dow Jones Industrial Average was down 15.9 points, or 0.07 percent, to 21,780.65, the S&P 500 had lost 7.67 points, or 0.31 percent, to 2,467.75 and the Nasdaq Composite had dropped 19.77 points, or 0.31 percent, to 6,362.42.

MSCI's 47-country All World share index was down 0.3 percent, while the European STOXX 600 index was down 1.2 percent.

Oil prices have been lifted this week as key OPEC members pledged to reduce exports and the U.S. government reported a sharp decline in crude inventories.

Brent crude futures were at $52.42 per barrel, up 93 cents, while U.S. crude futures were up 67 cents at $49.70.

U.S. crude was up 8.4 percent for the week so far, which would be its best this year.

The U.S. dollar was broadly lower as a combination of underwhelming U.S. economic data and political uncertainty kept traders biased toward the euro and other world currencies.

The euro moved higher against the dollar, and was last up 0.5 percent at $1.1740.

U.S. gross domestic product growth picked up to 2.6 percent in the second quarter, matching expectations of economists polled by Reuters, while growth in the first quarter was revised down to 1.2 percent.

U.S. Senate Republicans failed early on Friday to overturn the healthcare law known as Obamacare, in a stinging blow to President Donald Trump that may end the Republican Party's seven-year quest to repeal the Affordable Care Act.

U.S. Treasury yields fell. Other data showed that U.S. labor costs increased less than expected in the second quarter. The Employment Cost Index, the broadest measure of labor costs, increased 0.5. percent in the April-June period.

Benchmark 10-year notes were last up 5/32 in price to yield 2.29 percent, down from 2.31 percent on Thursday.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.bi z / c m s / ? p a g e I d = l i v e m a r k e t s

(Additional reporting by Abhinav Ramnarayan in London and Tanya Agrawal in Bengaluru; Editing by Jermey Gaunt and James Dalgleish)