* Russian stock market, bonds and currency plunge
* Gold and oil climb as Ukraine tensions spur safety bids
* CBOE Volatility Index, the VIX, jumps more than 14 pct
* Dow down 0.9 pct; S&P 500 off 0.7 pct; Nasdaq off 0.7 pct
By Angela Moon
NEW YORK, March 3 (Reuters) - U.S. stocks tumbled on Monday alongside other risky assets globally as tensions in Ukraine and Russia escalated after Russian President Vladimir Putin declared he had the right to invade his neighbor.
News that Ukraine mobilized for war on Sunday and Washington threatened to isolate Russia economically overshadowed better-than-expected U.S. data, including an index showing that factory activity rebounded from an eight-month low in February.
The S&P 500 had closed at a record high on Friday, and profit-taking was expected on Wall Street due to the political uncertainty. The index found some support when it fell to 1,840, but broke below it after the first attempt. The S&P 500 extended losses in early afternoon trading and then recovered slightly to close above the support level.
"It's too early to tell whether this would be a buying opportunity because we need to see how this (tension between Ukraine and Russia) plays out. It depends on how far this escalates, but I would suggest hedging before making any bets at this point," said Randy Frederick, managing director of active trading and derivatives for Charles Schwab in Austin, Texas.
The CBOE Volatility Index, also known as the VIX, shot up 14.29 percent, its biggest one-day jump in a month, to end at 16. The VIX, which generally moves inversely to the S&P 500, is used to hedge against the market's further decline. The VIX is also regarded as Wall Street's barometer of fear.
The Dow Jones industrial average fell 153.68 points or 0.94 percent, to end at 16,168.03. The S&P 500 slid 13.72 points or 0.74 percent, to finish at 1,845.73. The Nasdaq Composite dropped 30.818 points or 0.72 percent, to close at 4,277.301.
Russian stocks and bonds fell sharply and the central bank raised interest rates to defend the ruble. The MICEX index of Moscow stocks tumbled 10.8 percent and the dollar-denominated RTS stock index dropped 12 percent.
The market rout highlighted the damage the crisis could do to Russia's vulnerable economy, making it harder to balance the budget and potentially undermining business and public support for Putin.
In U.S. trading, the Market Vectors Russia ETF fell as much as 9 percent in heavy volume to a 4-1/2 year low of $22.16. It ended down 6.8 percent at $22.76.
But the Direxion Daily Russia Bear 3x ETF, a leveraged play on bad news that could affect the fortunes of the nation's listed stocks, jumped 21 percent to $20.98.
Energy stocks could lose if relations between the United States and Russia deteriorate further.
"Anything that involves a boycott of Russian supplies, which are very significant, could impact the energy sector dramatically," said Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey.
"In situations like this, you see very quick reactions reverse as people understand the scenario and how things play out."
Brent crude prices rose $2.13 to settle at $111.20 per barrel while U.S. crude prices gained $2.33 to end at $104.92 a barrel. The S&P energy sector index, which opened higher, closed down 0.6 percent.
Gold prices hit a four-month high as investors sought safe-haven assets, boosting gold stocks. U.S.-traded AngloGold Ashanti shares gained 2.2 percent to $17.96.
Although the focus was on Ukraine, the economic calendar was busy on Monday. U.S. factory activity rebounded from an eight-month low in February, according to the Institute for Supply Management, while the Commerce Department said consumer spending rose more than expected in January. The data suggested that the economy was regaining some strength after a recent slowdown.
About 6.95 billion shares changed hands on U.S. exchanges, slightly lower than the 7 billion average for the past month, according to data from BATS Global Markets.
Decliners beat advancers on the New York Stock Exchange by a ratio of about 2 to 1, while on the Nasdaq, about eight stocks fell for every five that rose.