* NATO says Russian troops massing on Ukraine border
* Euro stocks tumble, Wall Street shakes off early weakness
* German industrial orders slide, sanctions bite
* Investors seek refuge in German bonds, yields hit new lows (Adds close of European markets, quote)
By Chuck Mikolajczak
NEW YORK, Aug 6 (Reuters) - 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 were slightly higher as buyers took advantage of recent weakness.
The S&P 500 is down more than 3 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 was trading modestly above 1,920, a key technical support level, and also managed to bounce from its 100-day moving average, another support level.
The situation with Russia “is certainly going to spook the market and we saw a little of that yesterday,” said Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, speaking of Tuesday’s afternoon selloff.
“As far as the broad market goes, we haven’t had a pullback of any size since April; every time we see a little weakness people tend to step in and buy, primarily because they have cash out there to put to work and there’s not a lot of places for that.”
The Dow Jones industrial average was up 30.31 points, or 0.18 percent, at 16,459.78. The Standard & Poor’s 500 Index was up 3.38 points, or 0.18 percent, at 1,923.59. The Nasdaq Composite Index was up 14.10 points, or 0.32 percent, at 4,366.94.
NATO said Wednesday 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 invade.
The euro bounced back after hitting a nine-month low of $1.331 against the dollar, but was still down 0.1 percent at $1.3367 amid threats of retaliatory Russian sanctions against the European Union and signs the crisis in Ukraine was affecting Germany, Europe’s biggest economy.
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 shed 0.2 percent. Dollar-traded Russian stocks stumbled 2.6 percent to touch their lowest level since May 6.
German 10-year bond yields fell 8 basis points to a record low of 1.092 percent, their biggest daily drop since September 2013.
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 percent to hit its lowest level in over a year, with financial stocks suffering over concerns about fallout from a rescue plan for ailing Banco Espirito Santo.
The benchmark 10-year U.S. Treasury note was up 4/32, the yield at 2.4672 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 banned.
Risk aversion and improving U.S. economic data, which continued on Wednesday with a narrowing of the trade deficit, helped lift the dollar index to as high as 81.716, an 11-month high against a basket of major currencies before it pared gains to 81.484.
Oil prices were little changed. Brent crude gained 34 cents to $104.95 while U.S. crude shed 22 cents to $97.90. Brent settled on Tuesday at its lowest level since Nov. 7, while U.S. crude had fallen to its lowest level since early February. (Additional reporting by Rodrigo Campos; Editing by Dan Grebler)