German stocks fell on Tuesday as several companies such as UBS and Alfa Laval posted weaker earnings and Greece's talks with private bondholders for a debt-swap agreement continued. Adding to downbeat sentiment, the International Monetary Fund warned that China's growth rate would drop abruptly in the event of a sharp recession in Europe.
The euro zone, the European Central Bank and the International Monetary Fund must approve a 130-billion-euro bailout package with Greece before February 15 in order to prevent the eurozone member nation from defaulting on its debts when it faces repayment of 14.5 billion euros in bonds on March 20.
The benchmark German DAX is currently at 6,730, down 34 points or half a percent from its previous close, while France's CAC 40, the U.K.'s FTSE 100 and Switzerland's SMI are moving down between 0.2 percent and 0.4 percent.
The Euro Stoxx 50 index of eurozone bluechip stocks is losing 0.2 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is down 0.4 percent.
Deutsche Lufthansa AG is losing 2.3 percent on a Wall Street Journal report that the carrier's cabin crew is taking legal action against the company's plans to use contract workers at Berlin's new airport.
Daimler is down 1.7 percent after the automotive major said it has reduced the number of employee regulations to 1000 from the previous 1,800, according to the Financial Times Deutschland.
Roth & Rau AG is tumbling 3 percent after the company unveiled cost-cutting measures to ensure a rapid and sustainable improvement in the company's earnings and financial strength.
Siemens is edging down 0.4 percent even as the company won yet another order worth more than $1 billion for the supply of key components for the Qurayyah combined cycle power plant in Saudi Arabia. Lender Commerzbank is edging up 0.2 percent and rival Deutsche Bank is little changed.
Elsewhere, most Asian shares closed lower on Tuesday as renewed fears over the possibility of a Greek default on its debt kept many investors at bay. China's Shanghai Composite index fell 1.7 percent, Hong Kong's Hang Seng eased marginally and Japan's Nikkei average edged down 0.1 percent.
Australia's benchmark S&P/ASX 200 retreated half a percent after the Reserve Bank of Australia surprisingly kept interest rates on hold at 4.25 percent, despite the uncertain global economic outlook.
Commodities such as copper and crude are subdued and the euro fell against the dollar and yen, while the Dow futures are rising marginally.
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