European shares dip further on Cyprus worries

LONDON, March 22 Fri Mar 22, 2013 4:08am EDT

LONDON, March 22 (Reuters) - European shares dipped on Friday, putting a key index on track for its worst weekly drop since November, as worries over Cyprus' bailout problems dented sentiment.

The pan-European FTSEurofirst 300 index fell 0.1 percent to 1,190.12 points, putting it on track for its worst weekly drop since November, while the euro zone's blue-chip Euro STOXX 50 index fell 0.2 percent to 2,678.57 points By 0806 GMT.

However, a 2.5 percent rise at BP, after the heavyweight oil major said it would return $8 billion to shareholders, cushioned equity markets from bigger losses.

Cyprus needs to find 5.8 billion euros ($7.50 billion) in new money by a Monday deadline if it is to receive an EU bailout to avert a collapse of its financial system that could push it out of the euro zone, having earlier rejected a plan to raise the funds by taxing bank customers' deposits.

Berkeley Futures associate director Richard Griffiths advocated investors to sell stocks on days when the market rose rather than buy them when the market fell, on expectations that equity markets could fall further next week.

Griffiths said Germany's DAX, which was down 0.2 percent at 7,916.77 points, could fall to 7,750 points early next week and added that clients were buying "put" options, which are often used to bet on a future fall in an asset or to protect against such a move.

"I would sell on the rallies. With all this uncertainty over Cyprus, the markets will be going a touch lower again," he said.

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