* NATO says Russian troops massing on Ukraine border
* Euro stocks tumble, Wall Street ends flat
* German industrial orders slide, sanctions bite
* Investors seek refuge in German bonds, yields hit new lows
(Adds close of U.S. markets)
By Chuck Mikolajczak
NEW YORK, Aug 6 European stocks fell on
Wednesday as concerns over a Russian troop build-up on the
border with Ukraine sent nervous investors into high-rated
bonds, while U.S. stocks closed little changed to hold at
The S&P 500 is down 3.4 percent since its most recent record
high on July 24, including a drop of nearly 1 percent on Tuesday
on concerns of Russian escalation in Ukraine.
But the benchmark index has managed to hold around 1,920, a
key technical support level, and also managed to bounce from its
100-day moving average, another support level.
"On the domestic side we're seeing markets that are
see-sawing and still appearing to be assessing damage from
volatility over the last few days. Everything seems to be taking
a backseat to concerns in Russia and Ukraine right now," said
Lawrence Glazer, managing partner at Mayflower Advisors in
The Dow Jones industrial average rose 13.87 points or
0.08 percent, to close at 16,443.34, the S&P 500 gained
0.03 point to 1,920.24 and the Nasdaq Composite added
2.22 points, or 0.05 percent, to 4,355.05.
NATO said on Wednesday that Russia has amassed around 20,000
combat-ready troops on Ukraine's eastern border and could use
the pretext of a humanitarian or peace-keeping mission to
The euro hit a nine-month low of $1.331 against the
dollar amid threats of retaliatory Russian sanctions against the
European Union and signs the crisis in Ukraine was affecting
Germany, Europe's biggest economy. But it managed to bounce back
and was up slightly at $1.3377.
German industrial orders slid in June at the steepest rate
since September 2011, and the economy ministry said political
tensions had probably led to more consumer caution.
The FTSEurofirst 300 closed down 0.8 percent while
MSCI's world equity index dipped 0.3 percent.
Dollar-traded Russian stocks stumbled 2.6 percent to end
at the lowest level since May 6.
German 10-year bond yields were down 7 basis
points at 1.104 percent after earlier hitting a record low of
Yields on lower-rated peripheral bonds rose, extending
losses after data showed Italy, the bloc's third-largest
economy, had unexpectedly slipped back into recession.
The ECB, which is due to meet on Thursday, has made
unprecedented policy moves in recent months to try to keep the
bloc's fragile recovery on track.
Portuguese bonds were the worst hit on
Wednesday, their yields rising 10 bps to 3.79 percent. The
country's main bourse dropped 4.1 percent to hit its
lowest level since July 2013, with financial stocks suffering on
concerns about fallout from a rescue plan for ailing Banco
The benchmark 10-year U.S. Treasury note was up
4/32, the yield at 2.469 percent.
The European Union and the United States last week adopted
tough new sanctions against Russia over its actions in Ukraine,
marking a new phase in the biggest confrontation between Moscow
and the West since the Cold War.
Russian Prime Minister Dmitry Medvedev threatened on Tuesday
to retaliate for the grounding of a subsidiary of national
airline Aeroflot because of EU sanctions, with a newspaper
reporting that European flights to Asia over Siberia could be
Risk aversion and improving U.S. economic data, which
continued on Wednesday with a narrowing of the trade deficit,
helped lift the dollar index as high as 81.716, an
11-month high against a basket of major currencies before it
pared gains to 81.42.
Brent crude settled down 2 cents to $104.59 a barrel
while U.S. crude settled down 46 cents at $96.92 after
inventory data showed a smaller drop than announced in a
separate report on Tuesday.
(Additional reporting by Akane Otani; Editing by Dan Grebler)