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European stocks remain lower ahead of Cyprus vote; Dax down 0.19%

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Investing.com - European stocks remained lower on Tuesday, as concerns over the handling of the debt crisis in the euro zone following news of a controversial bailout plan for Cyprus continued to weigh on market sentiment.

During European afternoon trade, the EURO STOXX 50 slid 0.33%, France's CAC 40 retreated 0.51%, while Germany's DAX 30 edged down 0.19%.

Sentiment weakened on Monday following news that a one-time tax was to be imposed on bank deposit holders as part of a EUR10 billion bailout deal for Cyprus.

The agreement marked the first time since the onset of the euro zone debt crisis that depositors have been forced to take a haircut in return for financial aid.

Investor confidence slightly improved however, following reports that the Cypriot government was working on a revised deposit tax proposal, aimed at lessening the impact on smaller depositors ahead of a parliamentary vote later Tuesday.

Financial stocks pushed lower, as French lenders BNP Paribas and Societe Generale declining 1.51% and 1.97%, while Germany's Deutsche Bank tumbled 1.78%.

Peripheral lenders added to losses, with Italian banks Intesa Sanpaolo and Unicredit retreating 0.58% and 1.03% respectively, while Spain's BBVA slid 0.92%.

Elsewhere, Richemont plummeted 3.47%, following reports Goldman Sachs is managing the sale of about 7 million Richemont shares for CHF76.30 to CHF77.50 each.

In London, commodity-heavy FTSE 100 eased up 0.04%, despite losses in mining stocks, while data showed that consumer price inflation in the U.K. rose 2.8% last month, in line with expectations.

Mining giants BHP Billiton and Rio Tinto plunged 2.90% and 3.67% respectively, while rival company Evraz retreated 4.49%.

Earlier in the day, Goldman Sachs downgraded its rating on Rio Tinto to "conviction sell" from "neutral", saying it estimates earnings declines for the commodity producer.

Copper producers Xstrata and Kazakhmys also remained on the downside, with shares plummeting 1.32% and 5.14%.

Meanwhile, ARM, the designer of chips for Apple iPhones, tumbled 3.11%, extending earlier losses, after saying that Warren East will retire in July after nearly 12 years as CEO.

In the financial sector, stocks continued to trend lower. Shares in HSBC Holdings dipped 0.01% and the Royal Bank of Scotland slid 0.64%, while Lloyds Banking slumped 0.63% and Barclays declined 1.16%.

In the U.S., equity markets pointed to a slightly higher open. The Dow Jones Industrial Average futures pointed to a 0.13% rise, S&P 500 futures signaled a 0.19% gain, while the Nasdaq 100 futures indicated a 0.20% increase.

Also Tuesday, the ZEW index of German economic sentiment ticked up to 48.5 in March from February's reading of 48.2. Analysts had expected the index to dip to 48.0 this month.

However, the ZEW index of euro zone economic sentiment declined to 33.4 in March from a reading of 42.4 in February, amid concerns over political uncertainty in Italy and fears over the rescue package for Cyprus.

Later in the day, the U.S. was to release official data on building permits and housing starts.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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