(Adds U.S. markets opening) * Graphic: Global asset performance tmsnrt.rs/2yaDPgn * Graphic: World FX rates tmsnrt.rs/2egbfVh * Reuters Live Markets blog: NEW YORK/LONDON, Jan 27 (Reuters) - Stocks fell and the dollar rose on Wednesday as investors turned more cautious about COVID-19 and stretched stock valuations, with the U.S Federal Reserve meeting and a glut of corporate earnings also in focus. Investors parsed through earnings reports from companies including Boeing and Microsoft, ahead of the Federal Reserve’s policy statement later in the day. The Dow Jones Industrial Average fell 547.59 points, or 1.77%, to 30,389.45, the S&P 500 lost 74.03 points, or 1.92%, to 3,775.59 and the Nasdaq Composite dropped 275.52 points, or 2.02%, to 13,350.55. “There is plenty of discussion on Covid-19 variants, lockdowns, earnings, and co-ordinated retail assaults on single names to more than dampen risk appetite,” said Stephen Innes, chief global markets strategist at Axi. Boeing Co posted a record annual loss but shares in Microsoft hit a record high after it said its Azure cloud computing services grew by 50%. MSCI’s gauge of stocks across the globe shed 1.85%. Following a weak Asian session in which shares were hurt by profit-taking, European indexes also retreated, with the STOXX 600 down 0.8%. London’s FTSE 100 was down 1.5% while Germany’s DAX was down 2.4%. The dollar index rose 0.744%, with the euro down 0.79% to $1.2064. “There’s been a bit of a shift of tone in markets in the last few days,” said Catherine Doyle, investment specialist at Newton Investment Management. “Markets are starting to worry about COVID again,” she added, highlighting in particular the Brazilian and South African variants of the virus. Quarterly earnings from U.S. tech giants including Facebook and Apple, are due later in the session. “With some financial assets currently trading at what many are describing as bubble territory, there’ll be heightened attention on these releases to see whether these current valuations are justified,” Deutsche Bank strategist Jim Reid said in a note to clients. Heightened participation of retail investors in the stock market has come into focus this week, as amateur traders on Reddit’s r/WallStreetBets stock trading discussion group piled into GameStop, causing it to skyrocket while professional shortsellers scrambled to cover losing bets. To some stock market professionals, the recent moves look symbolic of a stock market that may be overvalued at the end of a year dominated by floods of fiscal and monetary stimulus to ease the coronavirus crisis. Newton Investment Management’s Doyle said that people “taking a punt on the market” is a sign that “risk appetite has got carried away”. Also in focus is the U.S. Federal Reserve’s policy meeting. The Fed is not expected to make any policy changes but investors will be listening for shifts in tone around the economic outlook and any mention of slowing down - or “tapering” - the Fed’s asset purchases. U.S. Treasury yields slumped as nagging concerns about the surge in virus cases, the prospect of prolonged lockdowns, and challenges to vaccine rollouts weighed on the global economic outlook. Benchmark 10-year notes last rose 9/32 in price to yield 1.0093%. The International Monetary Fund raised its forecast for global economic growth in 2021, and said the coronavirus-triggered downturn last year would be nearly one percentage point less severe than expected. Global COVID-19 cases surpassed 100 million on Wednesday and countries around the world are struggling with new variants of the virus and delays in vaccine rollouts. The euro was last down 0.79 percent, at $1.2064. Spot gold prices fell $-18.01 or -0.97 percent, to $1,832.30 an ounce. Oil prices rose after industry data showed U.S. crude stockpiles fell unexpectedly last week and China recorded its lowest daily rise in COVID-19 cases in more than two weeks. Brent crude was last down $0.27, or down 0.48 percent, at $55.64 a barrel. U.S. crude was last down $0.31, or down 0.59 percent, at $52.3 per barrel.