* U.S. stocks fall in choppy trade, worries over Greece
* U.S. Treasuries gain on safe-haven bid
* Dollar rises vs euro as risk-aversion remains
(Updates to close of European markets, updates U.S. markets)
By Manuela Badawy
NEW YORK, May 18 (Reuters) - The euro fell on Tuesday
despite progress on a rescue package for debt-stricken Greece
and U.S. stocks fell in choppy trade as the weakness of the
euro stirred concerns about the impact on sales of technology
companies with big overseas sales.
Investors' aversion to risk remained high, despite progress
on a rescue package for Greece, driving up U.S. Treasury
prices. Some analysts questioned the sustainability of the
global economic recovery and the ability of the U.S. Federal
Reserve to begin to move away from keeping short-term interest
rates near zero percent.
European shares, however, rose, snapping two consecutive
days of declines, after Greece received funds from the European
Union to repay its immediate debt. Banks rebounded and were
among the best performers after a flat performance on Monday.
But another wave of caution colored investor sentiment
after the close of European markets, and U.S. safe-haven assets
strengthened as investors worried about the long-term
sustainability of the 750 billion euro ($925 billion) plan to
rescue the debt-laden euro zone.
"It's a one-two punch: First is continuing concern over the
euro and continuing concern over the viability of the (single
currency) union, and then second is rotation out of large-cap
tech," said Peter Kenny, managing director at Knight Equity
Markets in Jersey City, New Jersey.
The Dow Jones industrial average <> rose 2.94 points,
or 0.03 percent, at 10,628.77. The Standard & Poor's 500 Index
<.SPX> was down 1.99 points, or 0.18 percent, at 1,134.95 and
the Nasdaq Composite Index <> was down 14.88 points, or
0.63 percent, at 2,339.35.
Shares of technology companies such as Intel and Apple,
which tend to rely heavily on overseas sales, led losses. Intel
Corp <INTC.O> dropped 2 percent to $21.47 while Apple <AAPL.O>
slipped 0.4 percent to $253.23.
Limiting the broader market's losses was Wal-Mart Stores
Inc <WMT.N>, the world's largest retailer, whose shares rose
2.8 percent at $54.19 after earnings topped estimates.
Global stocks as measured by the MSCI All-Country index
<.MIWD00000PUS> shed gains to trade up 0.12 percent while its
emerging markets component <.MSCIEF> rose 0.27 percent.
The FTSEurofirst 300 <> index of top European shares
closed up 1.3 percent at 1,026.64 points.
The index is still down 1.8 percent for the year on
concerns about the euro zone sovereign debt crisis in the
peripheral economies.
In economic news, ZEW economist Michael Schroeder said the
euro zone rescue package would weigh on medium-term growth in
Germany as budget cuts reduced demand.
Earlier, the ZEW Institute reported that its May German
economic sentiment index fell more than expected in May.
[]
U.S. Treasuries rose as the euro weakened against the
dollar and Wall Street stocks fell from earlier gains. The
30-year bond rose a full point as investors viewed it as cheap
relative to other Treasuries.
"There is some fine-tuning of risk positioning," said
Michael Woolfolk, senior currency strategist at BNY Mellon in
New York.
The 30-year bond <US30YT=RR> rose 1-5/32, its yield easing
to 4.29 percent from 4.36 percent on Monday.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was up
14/32, with the yield at 3.4385 percent. The 2-year U.S.
Treasury note <US2YT=RR> was up 1/32, with the yield at 0.7854
percent.
The euro <EUR=> fell 0.31 percent at $1.2355 per dollar,
while against the Japanese yen, the dollar <JPY=> was down 0.11
percent at 92.48.
Earlier, the euro had risen against the dollar on optimism
that financial aid for Greece was coming through as planned.
"We believe the 'breather rally' in EUR merely represents a
selling opportunity, as the currency will be plagued by
austerity in some countries and loan guarantees out of the
other countries -- hardly a recipe for a buoyant regional
economy and/or stronger currency," said T.J. Marta, chief
market strategist at Marta on the Markets LLC, long before the
euro fell on the day.
Officials said Greece received a 14.5 billion euro
emergency loan from the European Union and would use some of
the money to repay in full an 8.5 billion euro bond maturing on
Wednesday [].
That helped narrow the 10-year Greek/German government bond
yield spread and cut the cost of insuring against a Greek
default, supporting the euro.
U.S. crude oil futures rose sharply <CLc1>, rising 1.7
percent to $71.31.
Earlier, Asian stocks fell to three-month lows as traders
continued to fret about the impact that euro zone spending cuts
would have on exporters in the region. In Japan, the Nikkei
<> closed little changed after a choppy session.
(Additional reporting by Nick Olivari in New York; Editing by
Leslie Adler)
