The euro came under fresh pressure in early trading on Tuesday as fears over the health of the common currency resurfaced following initial euphoria over a rescue deal for struggling Spanish banks.

On Monday the markets had enjoyed a brief bounce as they reacted to the weekend news that Spain's eurozone partners had agreed to extend up to 100 billion euros ($125bn) to salvage a banking sector weakened by reckless lending to a property market that crashed in 2008.

That bounce had disappeared by the close of play and on Tuesday markets in Asia opened in determinedly negative mood amid fears that the deal to shore up Spanish banks would not be enough to avert catastrophe in the eurozone.

The common currency, which rose past $1.26 in Asian trade on Monday, bought $1.2480 early Tuesday.

Tokyo stocks fell 1.28 per cent by noon and Hong Kong opened 0.85 per cent lower, as oil prices dipped further.