GLOBAL MARKETS-Ukraine anxiety triggers flight to safety, stocks tumble

* DAX set for biggest weekly fall since acme of euro crisis

* Yen builds on sharp overnight gains against dollar, euro

* Russian shares plummet before Sunday's Crimea referendum

* U.S. data reinforces taper views; China data fuels fears

By Marc Jones

LONDON, March 14 (Reuters) - Heightened tensions ahead of Ukraine's weekend referendum in Crimea and stresses over China's growth pushed world stocks to their lowest in a month on Friday and sent investors scurrying into safe-haven gold and bonds.

European shares .FTEU3 started the day down 0.6 percent, putting most of the region on course for its biggest weekly drop since January while the DAX .GDAXI , whose German constituents have the most exposure to Russia, was facing its largest weekly losses since the height of the euro crisis in June 2012. Href="NewsSearch">.EU

Hardest hit was Moscow's MICEX .MCX index. It was down more than 5 percent at its lowest since 2009 and there was no let up in the pressure on the rouble RUB= either as it hovered near an all-time low. News Search ID:nL6N0MB0O0

Russia launched new military exercises near its border with Ukraine on Thursday, even as both the U.S. and Europe warned that Moscow risked facing serious steps if annexation was the outcome of a referendum planned for Sunday in the Crimea.

News Search ID:nL6N0MA2ZT News Search ID:nL2N0MA11V

"The Ukraine is one of the most serious geopolitical situations at the moment and how it plays out is difficult to forecast," Salman Ahmed, a global fixed-income strategist at the investment arm of Swiss private bank Lombard Odier, said.

"The main risk factor is that it morphs into an unintended clash and there is bloodshed."

On top of the geopolitical power struggle, jitters also remained over the degree to which China's economy is slowing.

Copper, seen as a proxy for China's fortunes, steadied after its dizzying 5-percent fall this week, but MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS touched its lowest level since mid-February. Tokyo .N225 ended the week down more than 6 percent after 3.3 percent dive on Friday.

"Investors are unwinding their long positions in the Nikkei and short positions in the yen," Kyoya Okazawa, head of global equities and commodity derivatives at BNP Paribas, said.

TAPER ON TRACK

One of the reasons for the Nikkei's decline was that the latest developments in the Ukraine crisis sent the safe-haven yen soaring against both the dollar and the euro.

The greenback was down about 0.2 percent at 101.64 yen

JPY= , while the euro slipped a similar amount to 141.05 yen.

EURJPY=R

Part of the concern over the Crimea referendum is that is could encourage other pro-Moscow parts of the country to follow suit and potentially embolden Russia in the region.

U.S. Secretary of State John Kerry is set to meet Russian counterpart Sergei Lavrov later in the day in London in last-ditch diplomatic efforts to defuse tension between Moscow and the West. News Search ID:nL6N0MB0JX

"What we would like to see is a commitment to stop putting new facts on the ground and a commitment to engage seriously on ways to de-escalate the conflict," a U.S. State Department official said.

Solid U.S. retail sales and employment data on Thursday had also reinforced expectations that the U.S. Federal Reserve will stick to its plan of gradually withdrawing its asset-buying stimulus. That came after disappointing Chinese economic data.

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EM 2014 FX performance Href="Link">http://link.reuters.com/jus35t

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PLAYING SAFE

The scuttle to safety pushed down German government bond yields after those on the benchmark 10-year U.S. Treasury note

US10YT=RR had fallen to two-week low 2.638 percent in Asian trading despite the upbeat U.S. data.

Gold, another safe-haven favourite, was nearly flat on the day at $1,369.06 an ounce XAU= after hitting a fresh six-month high, and was poised for its sixth straight weekly rise. GOL/

China's worries continued to weigh on the Australian dollar, considered a proxy for China plays, sending it AUD=D4 down about 0.2 percent to $0.9009. Oil LCOc1 held above $107 a barrel but remained on track for its third straight weekly loss.

The euro EUR= also remained under pressure after comments from European Central Bank President Mario Draghi, who said the bank has been preparing additional policy steps to guard against deflation taking hold in the euro zone. News Search ID:nF9N0D300V

The single currency was down about 0.1 percent at $1.3860

EUR= , moving away from Thursday's 2-1/2-year high of $1.3967 hit before Draghi spoke.

(Additional reporting by Ayai Tomisawa; Editing by Louise Ireland)

((lisa.twaronite@thomsonreuters.com)(+81 3 6441 1870)(Reuters Messaging: lisa.twaronite.thomsonreuters.com@reuters.net))

 
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Keywords: MARKETS GLOBAL/