Market update: Controversial Cyprus bailout spooks European investors

After closing near to a record high on Thursday, the S&P 500 and the Dow Jones both closed down 0.2% on Friday. A notable drag on both indices was JPMorgan, which lost 1.9% as a Senate report suggested that JPMorgan had misled investors with regards to losses in a derivatives portfolio.

This morning European shares are falling sharply in early trading. The markets are being rattled by the bailout plan for Cyprus announced over the weekend where its citizens have been asked to pay up to 10% of their bank deposits in exchange for a €10bn bailout. The FTSEurofirst 300 and the FTSE 100 are both down 0.7%. Monday’s trading in Asia has also been hit by concerns in the eurozone; in Hong Kong shares close down 2%, its lowest in more than three months and the Chinese markets suffered their worst loss in two weeks.