European stocks are seen opening flat with a positive bias on Tuesday after Eurogroup President Jeroen Dijsselbloem backed off from his comments made in an interview to Reuters and the Financial Times. The bank restructuring plan for Cyprus is “tailor-made” to the situation of the country and it cannot be considered a template for bank restructuring elsewhere in the 17-nation currency bloc, he clarified after his earlier comments created chaos in the markets.
With Cypriots reacting with anger over the bailout deal, the Mediterranean island nation ordered banks to remain closed till Thursday to ensure the smooth functioning of the entire banking system. Also, the government imposed limits on cash withdrawals and enacted measures to prevent cash flowing out of the country.
Asian stocks are turning in a mixed performance on concerns the bailout deal for Cyprus will have wider implications beyond the country. China’s Shanghai Composite index is down 1.3 percent amid reports Beijing is stepping up property curbs. Japan’s Nikkei index fell 0.6 percent even as Bank of Japan Governor Haruhiko Kuroda outlined monetary easing options in parliament to fulfill the government’s plan of achieving a 2 percent inflation target in two years.
South Korea’s Kospi average rose 0.3 percent on expectations the Bank of Korea may cut the key interest rate as early as April after data released by the central bank showed the nation’s economy grew just 2 percent in 2012, marking its slowest expansion in three years.
In domestic corporate news, Swiss lender Credit Suisse Group announced the appointment of Martin Keeble as CEO, President and Representative Director of Credit Suisse Securities (Japan), effective March 22.
German drug distributor Celesio reported fiscal 2012 loss of 149.0 million euros compared to a profit of 5.8 million euros in the previous year.
Telecommunications company Freenet AG announced that its Executive Board and Supervisory Board will propose to the AGM a dividend payout in the amount of 1.35 euros per share.
Deutsche Wohnen AG reported that its fiscal 2012 profit before taxes, after being adjusted for one-off items and valuation effects, increased by around 71 percent to 78.5 million euros from 46.0 million euros in the previous year.
European stocks reversed early gains to end lower on Monday after Jeroen Dijsselbloem said the Cyprus deal could become a template for resolving euro zone banking problems going forward. France’s CAC 40 lost 1.1 percent, the German DAX fell half a percent and the U.K.’s FTSE 100 edged down 0.2 percent, but Switzerland’s SMI rose 0.2 percent.
U.S. stocks failed to sustain an early upward move overnight, as investors pondered over the wider ramifications of the Cyprus bailout. The Dow shed 0.4 percent, while the tech-heavy Nasdaq and the S&P 500 dropped about 0.3 percent each.
by RTT Staff Writer
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