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European stocks dropped for a third day as Cypriot President Nicos Anastasiades said lawmakers will probably reject a 5.8 billion-euro ($7.5 billion) bank-deposit levy needed to win a European Union-led bailout.
Cypriot lawmakers began debating how to spread the proposed tax on bank deposits among account holders today. The levy, announced March 16, sparked outrage in the island nation and concern among investors about setting a precedent by breaking the taboo against raiding accounts.
Parliament will probably reject the proposals, Anastasiades told Sweden’s TV4 channel in an interview. Banks and stock markets in Cyprus are closed until Thursday.
Stocks fell even as German investor confidence rose to the highest level in almost three years in March. The ZEW Center for European Economic Research said its index of investor and analyst expectations gained to 48.5 from 48.2 in February. Economists in a Bloomberg survey had predicted 48.1.
National benchmark indexes declined in 15 of the 18 western European markets. The U.K.’s FTSE 100 dropped 0.4 percent, Germany’s DAX fell 0.8 percent and France’s CAC 40 sank 1.2 percent.
Rio Tinto, the world’s second-biggest mining company, retreated 5.4 percent to 3,099.5 pence, the largest drop since November 2011. Goldman Sachs downgraded its rating on the stock to conviction sell from neutral, saying it estimates earnings declines for the commodity producer after cutting iron ore price forecasts for the next three years on oversupply.
ThyssenKrupp plunged 5.6 percent to 17.34 euros, the biggest retreat since March 6, 2012. Germany’s largest steelmaker is preparing to sell more than 1 billion euros of shares to increase its capital, Handelsblatt reported, citing unidentified people close to the company. ThyssenKrupp decline to comment, the newspaper said.
Richemont declined 4.5 percent to 75.95 Swiss francs, its biggest drop since Jan. 21. Goldman Sachs managed the sale of about 7 million Richemont shares for 77 francs each, according to two people familiar with the deal.
ARM Holdings Plc declined 2.8 percent to 895 pence after saying Chief Executive Officer Warren East will retire in July after nearly 12 years in the role. The designer of chips for Apple Inc. iPhones said Simon Segars, currently president of ARM, will take over.
Iliad SA, the French low-cost mobile carrier, surged 6.1 percent to 158.8 euros, the highest since at least 2004. Net income was 186.5 million euros for 2012, beating all but one of the eight analyst estimates.
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