Ukraine woes rise again spooking markets

Investor sentiment has been dropping this week, as reports of Russia building up forces close to Ukraine's border renewed concerns about a possible invasion.

Despite signals from Polish and Ukrainian leaders that such moves suggest intentions of an incursion on Ukraine's territory, the Interfax news agency said Moscow dismissed the accusations as "groundless." Also NATO officials said on Wednesday in a statement that the amassing of Russian troops at the Ukrainian border was a worrying sign.

NATO spokeswoman Oana Lungescu expressed worries that Putin could use "the pretext of a humanitarian or peace-keeping mission as an excuse to send troops into Eastern Ukraine."

Later on Wednesday also the US Defense Secretary Chuck Hagel said that the possibility of Russia invading Ukraine was growing.

Under the circumstances investors turned to save haven assets such as gold which jumped above the critical $1,300 mark. Stocks in Europe, US and Asia dropped on concerns over the possible Russian invasion.

The ruble as well as Russian government bonds have been under rising pressure since the beginning of the week. RUB fell by 1.2% since Tuesday, following Moscow's threat that it would retaliate against Western sanctions by blocking European airlines' flights over the Russian territory.