PARIS (dpa-AFX) - The European markets continued to languish in negative territory on Tuesday, ahead of a crucial vote in Cyprus' Parliament on the rescue package. The Asian markets recovered from the previous session's lows, after indications emerged that small depositors in Cyprus may be spared from the bank tax.
Cyprus' Parliament will vote on the rescue package later today, after postponing it twice in the last two days. The government has declared a temporary bank holiday in Cyprus on March 19 and 20.
The Eurozone finance ministers had called for a 9.9 percent tax on bank deposits above 100,000 euros and a tax of 6.75 percent on deposits below that amount, inviting widespread criticism from Cypriots.
However, the finance ministers Monday agreed that small Cypriot depositors should be given greater protection, signaling some flexibility over the proposed bank tax. Yet, the ministers reiterated that Cyprus should still raise 5.8 billion euros from the levy as planned.
The island nation may be able to meet the target by imposing a 15.6 percent tax on deposits of over 100,000 euros with no fee below that figure.
Meanwhile, economists at IHS Global Insight said the proposal to make bank depositors in Cyprus contribute to the planned bailout is likely to have drastic results, and could even threaten the stability of the Eurozone.
According to the economists, with Cyprus' ruling party enjoying only a one-seat majority, there is a strong possibility of parliament rejecting the bank levy in its current form, while its structure is likely to change in order to garner parliamentary support.
Germany's economic confidence improved for the fourth successive month in March, and exceeded economists' expectations.
The ZEW Indicator of Economic Sentiment moved up to 48.5 points in March from 48.2 points in February, marking the fourth consecutive increase, a survey by the Center for European Economic Research/ZEW showed. The latest reading exceeded the consensus forecast of 48.1 points.
U.K. inflation rose marginally as expected to 2.8 percent in February from 2.7 percent in January, the Office for National Statistics showed Tuesday.
The Euro Stoxx 50 index of eurozone bluechip stocks is losing 0.54 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 0.26 percent.
The German DAX is falling 0.6 percent and the French CAC 40 is losing 0.8 percent. Switzerland's SMI is sliding 0.4 percent.
In Frankfurt, ThyssenKrupp is declining 6.1 percent, amid reports that the steel maker is planning a capital increase.
Deutsche Bank is losing 1.7 percent and Commerzbank is falling modestly.
K+S, Basf and Munich Re are trading notably lower.
Deutz is dropping 3.2 percent after announcing full year results.
BMW is advancing around 1 percent. The carmaker said its outlook for 2013 is cautiously optimistic, and it targets a further rise in unit sales in the current year and hence a new sales volume record.
Department stores operator Metro is gaining 3.2 percent, after UBS raised the stock to 'Buy' from 'Neutral.'
Tom Tailor is gaining 3.6 percent after reporting higher adjusted earnings for the year on strong sales growth.
Grenkeleasing is gaining 1.3 percent. Commerzbank raised the stock to 'Buy' from 'Hold.'
In Paris, Credit Agricole, Societe Generale and BNP Paribas are losing between 2.3 percent and 1.3 percent.
Michelin is losing 2.3 percent, Bouygues is falling 1.6 percent and Vallourec is sliding 1.5 percent.
Arcelor Mittal is falling close to 3 percent in Amsterdam.
In London, Miners are seeing notable losses. BHP is losing 3.7 percent and Rio Tinto is losing 4.4 percent.
Deutsche Bank cut Fresnillo to 'Sell' from 'Hold.' The stock is retreating 4.5 percent.
Evraz is declining 5.8 percent and Weir Group is declining close to 4 percent. Berenberg reduced its rating on Weir to 'Hold' from 'Buy.'
Arm Holdings, which announced a new chief executive, is losing 2.7 percent.
Cairn Energy is losing 1.8 percent. The firm announced annual results.
J Sainsbury is gaining 2.6 percent after reporting higher sales for the fourth quarter.
ING is down 0.2 percent in Amsterdam. JPMorgan reinitiated the stock with an 'Overweight' rating.
Across Asia/Pacific, major markets were mixed. Australia's All Ordinaries fell 0.5 percent and Hong Kong's Hang Seng slid 0.2 percent. China's Shanghai Composite Index rose 0.8 percent and Japan's Nikkei 225 added around 2 percent.
In the U.S., futures point to a lower open on Wall Street. In the previous session, stocks ended lower amid a negative reaction to news out of Cyprus. The Dow fell 0.4 percent, the Nasdaq dipped 0.4 percent and the S&P 500 slid 0.6 percent.
In the commodity space, crude for April delivery is gaining $0.09 to $93.83 per barrel and April gold is losing $2.7 to $1601.9 a troy ounce.
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