Markets falter on European bank concerns and Japan worries

LONDON (AP) — Worries over the financial health of Europe's banks and skepticism over the Japanese government's latest stimulus package weighed on global markets on Tuesday even though Australia's central bank delivered a rate cut.

Michael Hewson, chief market analyst at CMC Markets in London, says the tests' findings failed to address many of the concerns investors have about the state of Europe's banks, including the rising costs they face for parking their cash at the European Central Bank.

"Skepticism that the EBA bank stress tests painted a far too rosy picture of the health of Europe's banks while paying no account of the current negative rate environment nor for that matter the fiscal health of Portuguese and Greek banks," Hewson said.

The latest measure by Prime Minister Shinzo Abe to get the stalling recovery back on track failed to excite despite his claim that it represents "an investment for the future."

The Reserve Bank of Australia cut its benchmark interest rate by a quarter of a percentage point to a record-low 1.5 percent on Tuesday, seeking to jolt the nation's sluggish economy amid low inflation rates.