Asian stocks fell, with the regional benchmark index posting the biggest weekly drop in seven months, as Cyprus struggled to prevent a financial collapse, stoking concern Europe’s debt crisis is intensifying.

Nikkei  12,338.53 -297.16 -2.35%

Hang Seng 22,115.3 -110.58 -0.50%

Shanghai Composite 2,328.28 +4.04 +0.17%

S&P/ASX  4,967.26 +7.86 +0.16%

The MSCI Asia Pacific Index fell 1.7 percent to 134.31 this week, the biggest weekly decline since the period ended Aug. 31, amid concern that an unprecedented levy on bank deposits in Cyprus may be a sign of deepening crisis in Europe.

Asian stocks fell after the European Central Bank said it may cut off Cyprus banks from emergency funds as the island nation struggles to stave off financial collapse after lawmakers rejected a bank deposit levy as a condition for a euro-zone rescue. Cyprus’ attempt to secure a bailout from Russia was rebuffed yesterday.

HSBC Holdings Plc, Europe’s biggest lender, slid 1.9 percent in Hong Kong.

BHP Billiton Ltd., the world’s biggest mining company, lost 6 percent in Sydney as commodities fell amid concern Europe’s crisis will hinder global growth.

Toyota Motor Corp., the world’s largest carmaker, lost 2.8 percent after Japan’s new central bank governor stopped short of announcing new stimulus.

European stocks were little changed, with the Stoxx Europe 600 Index falling for the first week in a month, as Cypriot lawmakers sought to unlock a 10- billion-euro ($13 billion) bailout fund.

Euro-area finance ministers expect a proposal from Cyprus “as rapidly as possible” to raise the 5.8 billion euros needed to trigger the emergency loans, they said in a statement late yesterday. Cyprus didn’t get the financial support it sought from Russia, although the two countries will continue talking, Cyprus Finance Minister Michael Sarris said.

The race for a compromise comes after a week of tumult marked by Cypriot lawmakers’ rejection of a tax on bank deposits. That was demanded by the other 16 euro countries and the International Monetary Fund as a condition for the 10 billion-euro rescue.

In Germany, business confidence unexpectedly fell in March from a 10-month high. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, fell to 106.7 this month from 107.4 in February. That’s the first drop in five months. Economists predicted a gain to 107.8.

National benchmark indexes declined in 11 of the 18 western European markets. France’s CAC 40 lost 0.1 percent, Germany’s DAX slipped 0.3 percent, while the U.K.’s FTSE increased 0.1 percent.

MAN lost 2.6 percent to 84.80 euros. VW, Europe’s largest carmaker, will offer other holders of MAN stock 80.89 euros per share in a bid for full control of the company. VW, which already owns 75.03 percent of the Munich-based company’s voting rights, will set the final cash offer after it receives valuation reports from auditors, MAN said yesterday. Volkswagen added 0.8 percent to 156.55 euros.

Mulberry plunged 17 percent to 1,024 pence. The company said that lower tourist spending in London will reduce pretax profit for the year ending March 31 to about 26 million pounds ($39.5 million) from 36 million pounds. The average estimate of three analysts compiled by Bloomberg was 30.7 million pounds.

Hochtief AG, Germany’s largest builder, slid 5.3 percent to 51.41 euros. Leighton Holdings Ltd. Chairman Stephen Johns and two non-executive directors resigned from the board of Australia’s largest construction company, citing a dispute with its controlling shareholder Hochtief.

U.S. stocks rose, paring the second weekly drop of the year for the Standard & Poor’s 500 Index, as Nike Inc. and Tiffany & Co. beat earnings estimates and optimism grew that Cyprus will pass a plan to qualify for a bailout.

Lawmakers in Cyprus began debating legislation to help unlock bailout funds needed to avoid a financial collapse. Government spokesman Christos Stylianides said talks with the European Central Bank, the European Commission and the International Monetary Fund were in the final stages.

The ECB has said it will cut emergency funds for Cypriot banks after March 25 unless it comes to an agreement with the so-called troika of the European Commission, the European Central Bank and the International Monetary Fund. Euro-area finance ministers expect a proposal from Cyprus “as rapidly as possible” to raise the 5.8 billion euros ($7.5 billion) needed to trigger the emergency loans, they said in a statement late yesterday after a teleconference.

Nike surged 11 percent to $59.53 for its biggest gain since 2008. The company said its gross margin widened for the first time in nine quarters as orders for the Nike brand in China climbed 3 percent, beating estimates for a decline of 4.3 percent, which would have been the third straight drop.

Tiffany advanced 1.9 percent to $69.23. The world’s second- largest luxury jewelry retailer said sales in the Asia-Pacific region advanced 13 percent to $254 million in the quarter, helped by store openings in Singapore, China and Australia.

Micron Technology Inc. climbed 11 percent to $10.04 for its biggest gain since 2011. The largest U.S. maker of memory chips said second-quarter sales increased 3.4 percent to $2.08 billion amid a rebound in chip shipments. That beat the average analyst estimate of $1.91 billion.

Monster Beverage Corp., the largest U.S. energy-drink maker by sales volume, dropped 3.7 percent to $48.50. Energy drinks, which have been linked to deaths and hospitalizations, may boost blood pressure and lead to an erratic heartbeat, according to a study led by Sachin Shah presented at an American Heart Association meeting.

At the close:

DJIA 14,512.00 +90.54 0.63%

S&P 500 1,556.89 +11.09 0.72%