LONDON, March 22 (Reuters) - European stocks were expected to edge lower on Friday, heading for their worst weekly loss since November as Cyprus scrambles to find a solution to its funding crisis, which could see the island become the first country to leave the euro zone. Futures for the Euro STOXX 50, Britain's FTSE and France's CAC were 0.4-0.5 percent lower at 0723 GMT, with contracts on Germany's DAX down 0.3 percent. In a sign it was at least preparing for the worst, the Cypriot government sought powers to impose capital controls to stem a flood of funds leaving the island if there is no deal before banks reopen on Tuesday. Such a scenario could also dent confidence in banks elsewhere in the euro zone. The Cypriot parliament was due to debate crisis measures on Friday, but they looked likely to be insufficient to raise 5.8 billion euros ($7.5 billion)demanded by the European Union in return for a 10 billion euro lifeline in time for Monday's deadline. Cyprus's hopes of securing help from Russia were also dashed, with Moscow saying on Friday that talks have finished, and that Russian investors were not interested in Cypriot gas reserves. Lee Robinson, founder of asset management firm Altana Wealth, said a default in Cyprus would send investors seeking shelter in assets perceived as safe, such as German and U.S. government bonds, on concerns that other euro zone countries may be affected and bank accounts raided . Robinson has been seeking protection against possible swings in share prices by buying implied volatility, an index which moves in the opposite direction to cash equities and is based on option contracts. "Volatility to me is a very underpriced asset given the potential outcomes globally," Robinson said. "If we have a meltdown in Europe it could go to the levels of 2008. If we have a bit of a recovery, it will probably trade sideways for a long period of time." The cost of options on euro zone blue chips, as measured by the Euro STOXX 50 volatility index, or VSTOXX, has ticked up since the Cypriot crisis started, but it is still at around half its 2012 high and a quarter of its all-time peak seen in 2008, in a sign investors still thought the worst of the crisis was now behind us. The VSTOXX closed at 19.79 on Thursday, still down around 35 percent since the European Central Bank president Mario Draghi pledged to save the euro in July 2012. "The market seems relatively calm given the distinct risks of Cyprus exiting euro zone but we expect the uncertainty to continue to weigh on market sentiment", analysts at Credit Agricole wrote in a note. The pan-European FTSEurofirst 300 index has fallen in four of the past five sessions, suggesting some profit taking was setting in. The index closed at its lowest level since Mar 7 on Thursday but it was still only 1.5 percent away from a 4-1/2-year high hit last week. A possible boost for the index could come from the widely followed German Ifo business climate survey at 0900 GMT, which was expected to show a fifth consecutive monthly rise in March. -------------------------------------------------------------------------------- MARKET SNAPSHOT AT 0724 GMT LAST PCT CHG NET CHG S&P 500 1,545.80 -0.83 % -12.91 NIKKEI 12,338.53 -2.35 % -297.16 MSCI ASIA EX-JP 533.44 -0.41 % -2.18 EUR/USD 1.2902 0.04 % 0.0005 USD/JPY 94.72 -0.17 % -0.1600 10-YR US TSY YLD 1.904 -- -0.01 10-YR BUND YLD 1.344 -- -0.02 SPOT GOLD $1,612.00 -0.13 % -$2.09 US CRUDE $92.54 0.1 % 0.09 > Asian shares, euro pressured by growth worries, Cyprus > Wall St slides as Oracle drops, Cyprus worries escalate > Nikkei retreats from multi-year highs on Cyprus concerns > TREASURIES-Prices gain as Cyprus scrambles for help > Cyprus debacle keeps euro in doldrums, yen steadies > Gold heads for biggest weekly rise in 4-mths on Cyprus > LME copper up, but set for biggest weekly drop in four > Brent holds above $107 ahead of Cyprus bailout deadline COMPANY NEWS BP The British oil company said on Friday it would launch an $8 billion share buy-back programme to return cash to shareholders after closing the sale of its stake in its Russian unit. LUXURY SECTOR, MULBERRY The British luxury brand on Friday warned on year profit again, partly blaming reduced tourist spending in London stores for weaker than expected post-Christmas revenue. E.ON Eike Batista, the controlling shareholder of Brazilian energy company MPX Energia SA, confirmed on Thursday he is in talks to sell a stake in the company to E.ON. ALSTOM The French power and transport group said it has renewed its existing bank guarantee facility for 9 billion euros, extending the maturity by three years to July 2016. LUFTHANSA The airline begins a next round of wage talks with union Verdi after pre-emptive strikes on Thursday forced the airline to cancel almost 700 flights. MAN SE, VOLKSWAGEN Remaining outside shareholders in MAN SE may receive a cash compensation of 80.89 per share and dividend of 3.07 euros (or 3.30 euros before tax) per share if a domination and profit and loss agreement with VW is approved at the AGM. SALVATORE FERRAGAMO The Italian star shoemaker forecast a rise in revenues and profits this year after demand from the Asia Pacific area helped lift its 2012 net profit by 30 percent to 106 million euros. SAP The company announced plans to change its legal form to that of an SE (societas europaea), and that it planned to seek approval for the move at the AGM in 2014. SALZGITTER Annual press conference. It has already reported a pretax loss of 29 mln euros for 2012 and said it sees 2013 profit in the low double-digit million euro range. SANOFI The effects of Sanofi's experimental multiple sclerosis drug Lemtrada continue to benefit the majority of patients long after they have completed their treatment, the French drugmaker said. HAVAS The French advertising agency reported a 5 percent rise in group net profit for 2012 on revenue growth that was slower than rivals. KBC, BANCO SANTANDER Belgium's KBC and Spain's sold almost 20 million of shares in Polish lender Bank Zachodni WBK for 4.9 billion zlotys ($1.5 billion), or 245 zlotys per share, BZ WBK said in a statement. ANHEUSER-BUSCH INBEV SA Cia de Bebidas das Americas SA, Latin America's largest brewer, plans to limit its exit of the Venezuelan market to the closure of a plant and will market its products in the Andean country through a local partner. HOCHTIEF Chairman Stephen Johns and non-executive directors Wayne Osborn and Ian Macfarlane of Leighton resigned Friday on their view that "Hochtief no longer supports an independent board at Leighton". UNIPOL The Italian insurer said on Thursday the 2012 net profit of the new group that will be created from the merger with peer Fondiaria-SAI was 441 million euros.