Uncertainty over the outcome of a budget battle in Washington pushed world stock markets lower on Monday.
US President Barack Obama and his political opponents have failed so far to agree on a way to roll back automatic spending cuts that took effect Friday. Those cuts slash $85 billion from the nation's budget, which could slow down the economy.
US lawmakers say they want to undo the cuts so that federal programs can be spared but are divided over whether higher taxes should be used to pay for them.
European stock markets opened lower. Britain's FTSE 100 declined 0.4 per cent to 6,355.55, with shares in HSBC down 2.7 per cent after the bank reported a drop in net profit for 2012 due to fines it paid in the US and UK on top of other one-time charges.
Germany's DAX fell 0.5 per cent to 7,671.93 while France's CAC-40 lost almost 0.1 per cent to 3,698.65.
Finance ministers from the 17-country Eurozone will meet later in the day in Brussels to discuss a bailout for Cyprus, but a final deal is expected to take another few weeks since a new government has just taken over in Nicosia.
Wall Street appeared headed for a lower open, too, with Dow Jones industrial futures slipping 0.4 per cent to 14,019 and S&P 500 futures shedding 0.3 per cent to 1,512.30.
Stock markets in China were dragged down by property shares that tumbled after China's Cabinet ordered new measures to cool surging housing prices. The government said it will raise required minimum down payments in areas where prices are deemed to be rising too fast and crack down on efforts to evade limits on how many properties each buyer can acquire. The Shanghai Composite Index slid 3.7 per cent to 2,273.40.
Hong Kong's Hang Seng fell 1.5 per cent to 22,537.81. South Korea's Kospi lost 0.7 per cent to 2,013.15. Australia's S&P/ASX 200 dropped 1.5 per cent to 5,010.50. Benchmarks in Singapore, Taiwan, Indonesia and the Philippines also fell.
But Japan's Nikkei 225 bucked the negative trend, rising 0.4 per cent to close at 11,652.29. Investors are seemingly in a buoyant mood ahead of a leadership change at the Bank of Japan. Governor Masaaki Shirakawa will step down on March 19, making way for a new chief who supports Prime Minister Shinzo Abe's call for bolder monetary easing. The central bank meets on Wednesday and Thursday for a regular monetary policy review.
Benchmark oil for April delivery was down 35 cents to $90.33 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.37 to close at $90.68 a barrel on the Nymex on Friday.
In currencies, the euro fell 0.2 per cent against the dollar, to $1.2994, while the dollar fell 0.1 per cent against the Japanese yen, to 93.56 yen.