LONDON, Nov 21 - European stocks and bonds trod water on Friday as investors balanced growing security fears after Thursday's deadly bombs in Turkey and further attacks in Iraq, with fresh data showing a robust recovery in the U.S.. The dollar remained within a cent of record lows against the euro, hit on Wednesday, after attacks on the Iraqi Oil Ministry and hotels in Baghdad which also pushed up oil prices. Stocks have surged since mid-March, but with four bombs in a week in Turkey killing more than 50 and wounding hundreds, investors' ardour has cooled. However, continued evidence that the U.S. economy is on the road to recovery has led investors to use the security concerns to book profits, rather than change their fundamentally positive view of stock markets. "At the sort of level (of attacks) we are seeing, I don't think it is going to disrupt the progression of the recovery," said Mike Lenhoff, chief strategist at Brewin Dolphin Securities. "The fundamentals are still very supportive." Investors were reminded on Friday of the fragile global security situation with the Iraqi Oil Ministry in Baghdad ablaze after rocket attacks which also hit two hotels used by Western contractors and journalists. But stocks were buoyed by data from the Philadelphia Federal Reserve on Thursday showing manufacturing in the mid-Atlantic region of the U.S. continuing to strengthen. Separate data showed employment conditions improving with the four-week rolling average of jobless claims dipping to its lowest level in nearly three years. By 0950 GMT, the FTSE Eurotop 300 index <.FTEU3> of pan-European blue chips was 0.04 percent up at 914.76 points, while the narrower DJ Euro Stoxx 50 index <.STOXX50E> was 0.01 percent ahead at 2,568.46. Asian stocks dipped on Friday taking their cue from falls on Wall Street the day before. But they came off their lows as investors decided the apparent suicide bombings did not heighten the risks for the region significantly. The Nikkei average <.N225> closed down 0.1 percent at 9,852.83. MSCI's broadest index of shares elsewhere in the Asia Pacific region <.MSCIAPJ> was down 0.23 percent at 0935 GMT.
BONDS, DOLLAR
Weak stock markets and continued safe-haven interest in the wake of Thursday's bombings saw bond yields fall slightly on Friday. At 0935 GMT, the two-year Schatz yield was down 0.6 basis points (bp) at 2.60 percent. Yields hit six-week lows of 2.53 percent after the two blasts on Thursday. The 10-year Bund yield was down 1.0 bp at 4.34 percent, up from Thursday's near one-month low of 4.29 percent. "All this has heightened worries about terrorist attacks and the closer it gets to the United States the more the panic," said Nicole Elliot, senior analyst at Mizuho Corporate Bank. The dollar continued to trade within a cent of record lows against the euro with the global security risks that have undermined the currency in recent months, at the forefront of investors' minds. "Given the current situation it's hard for the dollar to turn around," a senior foreign exchange trader at a U.S. bank said. "And incidents like these centring on Iraq are just going to instil more fear into the markets." The euro was at $1.1883 versus $1.1910 in late U.S. trade. It rose as high as $1.1975 on Thursday, near a record high hit on Wednesday. With security issues to the fore, crude oil futures rose in early trade with January Brent up 29 cents at $29.85. Safe-haven gold, however, remained flat at $393.25 to $394 a troy ounce, against its New York close at $393.30 to $394.//