By Daniel Inman
Asian markets were mostly lower Tuesday, as European concerns continued to weigh on sentiment.
Cyprus remained the focus for markets in Asia after Eurogroup head Jeroen Dijsselbloem on Monday said that the structure of the island's rescue package could serve as a template for future bailouts in region, according to media reports.
Although Mr. Dijsselbloem subsequently backed away from the comments, they had already put an end to the relief rally that followed Monday's bailout agreement.
Investors fear that the plan to impose losses on bondholders and some depositors could be repeated in other countries, contradicting the idea that the approach in Cyprus was a one-off solution, and increasing concerns that there could be reduced confidence in deposits held in banks in Europe's peripheral countries.
"The market is not convinced that what we have seen in Cyprus will not have long-term effects on the euro zone," said Tim Waterer, senior trader at CMC Markets in Sydney.
After falling 1.0% against the U.S. dollar overnight, the euro recovered a touch in Asian trade - recently at $1.2861, compared with $1.2853 late Monday in New York.
The U.S. dollar strengthened against the yen, recently at Y94.36 compared with Y94.17 late Monday. The upside for the dollar limited however as Japanese companies repatriated dividends from overseas subsidiaries at the end of the fiscal year.
Japanese stocks retreated, with the Nikkei down 0.2%, though index heavyweight Softbank managed a 3.1% gain after the firm announced that it would make a tender offer in April to increase its stake in GungHo Online Entertainment.
Australia's S&P/ASX 200 fell 0.6%, with mining stocks leading broad-based declines: Rio Tinto dropped 1.6% and BHP Billiton was 1.0% lower.
South Korea's Kospi was up 0.1%.
-Write to Daniel Inman at daniel.inman@wsj.com
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