LONDON -- Stock index futures at 7 a.m. EDT indicate that the Dow Jones Industrial Average may open 0.61% lower this morning, while the S&P 500 may open down 0.87%.

The big story this morning involves EU member state Cyprus, where the government is planning to impose a one-off tax on all bank deposits in order to partially fund the country's $13 billion bailout. The original plan called for a tax of 6.75% on deposits below 100,000 euros and 9.9% on deposits above 100,000 euros, but these proportions look likely to be renegotiated ahead of a parliamentary vote expected to take place later today.

Cyprus' banking sector is unusually large for such a small country, thanks to its status as a tax haven, and it's thought that at least one of Cyprus' biggest banks would have collapsed without a bailout deal, leaving the country's deposit guarantee scheme unable to meet its obligations. Since EU member states, led by Germany, refused to accept a partial default on Cypriot debt, the Cypriot government was left with no alternative but to introduce this unprecedented tax on savers' deposits. The move has raised fears that a similar solution could be implemented in Spain or Italy and may undermine investors' confidence in the euro.


Today's domestic economic calendar starts with March's homebuilders' index at 10 a.m. EDT. Consensus forecasts suggest a reading of 47, up slightly from 46 in February. Companies including Ameresco, KiOR, and Cumulus Media are expected to report earnings before the opening bell this morning, but there is little doubt that most investors' attention will be focused on events in Cyprus.

Stocks that may be actively traded today include Transocean , which was 2.1% lower in premarket trading after it announced its opposition to the dividend and director nominees proposed by activist investor Carl Icahn. Icahn has proposed a $4 per-share dividend, nominated three candidates for election to Transocean's board, and submitted a proposal to modify the company's staggered board structure. In a statement issued late on Sunday evening, Transocean said Icahn's dividend proposal "is in direct conflict with Transocean's disciplined capital allocation strategy" and that it would "adversely affect the company's ability to operate and compete effectively."

Banking stocks were also lower in premarket trading, with Citigroup down 2.4% and Bank of America down 2%.

European markets
European markets dropped this morning in response to news of the Cyprus bailout deal, although losses were fairly modest and mostly restricted to banking stocks.

At 7:15 a.m. EDT, the DAX was down 1.05%, the CAC 40 was down 1.43%, the FTSE MIB was down 2.15%, and the IBEX 35 was down 2.12%. In London, the FTSE 100 was down 0.83%, with Barclays and Royal Bank of Scotland Group both down by 4.5%. One company that did beat the trend was chain retailer Marks & Spencer Group, which rose 7.7% this morning after a weekend report in the Sunday Times newspaper suggested that the Qatar Investment Authority may be assembling a takeover bid for the company that would value it at 8 billion pounds.

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The article Dow May Slide Ahead of Cyprus Savings Tax Vote originally appeared on Fool.com.

Roland Head but does not own shares in any of the companies mentioned in this article. The Motley Fool owns shares of Transocean, Bank of America, and Citigroup. Motley Fool newsletter services have recommended buying shares of Ameresco. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

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