European markets closed down after the parliament in Cyprus overwhelmingly rejected a controversial bank bailout deal.
The vote will ease concerns of Cypriots who faced a one-off tax on their savings under the deal, but it increases unease across the eurozone.
EU finance ministers have warned that Cyprus' two biggest banks are now close to collapse.
Local media in Cyprus reports that the government will now renegotiate the terms of the deal with the troika of lenders.
European markets closed down even before the vote was taken - the FTSE 100 retreated 0.3 per cent to 6,441, Spain's IBEX lost 2.2 per cent to 8,321 and Germany's DAX lost 0.8 per cent to 7,948.
Across the Atlantic, Wall Street trimmed losses in late trade and ended mixed.
The Dow Jones Industrial Average added 4 points, or just 0.03 per cent, to 14,456.
The S&P 500 lost 0.2 per cent to 1,549.
That was despite some encouraging data overnight, with official figures revealing housing starts climbed in February and construction permits rose to a five-year high, showing a continued recovery in the American housing market.
The US Senate inched closer overnight to passing a bill to extend funding for federal agencies which is needed to avoid a government shutdown due at the end of this month.
In Australia, the ASX SPI 200 is indicating a poor start to trade on the local market, it was down 0.5 per cent to 4,952.
Turning to currencies, and the Australian dollar remained in a tight trading band overnight and at 7.20am (AEDT) it was buying 103.69 US cents.
On the cross rates it was worth 80.45 euro cents, 68.65 British pence and 98.56 Japanese yen.
West Texas crude dropped to $US92.42 a barrel and, in Singapore, Tapis was higher at $US115.05.
The spot gold price rose $US7.41 to $US1,611.94 an ounce.