By Anjli Raval
Published: May 26 2010 03:00 | Last updated: May 26 2010 03:00
European stocks fell to an eight-month closing low, with central and eastern markets suffering the heaviest losses as weakness in the Spanish banking sector confirmed investors' fears about a spreading eurozone debt crisis.
Romania's BET index tumbled 11 per cent to 4,365.99, a seven-month low, on concerns about looming strikes against government cost-cutting measures.
Russia's Micex index also dropped to a seven-month low, down 5.7 per cent to 1,197.39, as the price of crude oil - the country's chief export earner - declined below $68 a barrel in New York.
The Micex yesterday entered technical bear-market territory, with its decline from an April peak now exceeding the 20 per cent threshold.
Ukraine's PFTS index lost all its gains for the year so far, sinking 6.2 per cent to 613.18 as discussions between the International Monetary Fund and the government about the country's debt stumbled over budgetary disagreements, according to analysts at BNP Paribas.
Turkey's ISE National index slid 4.2 per cent to 52,257.07 after Credit Suisse downgraded the country's banks.
The Budapest Stock Exchange fell 4.6 per cent to 20,679.55 while the Prague Stock Exchange lost 5.2 per cent to 1,097.
The FTSE Eurofirst 300 sank to its lowest closing level since early September 2009, losing 2.4 per cent to 949.87, led by heavy losses in the banking sector.
The declines mirrored the steep losses from the US and Asia, triggered mainly by the Spanish central bank's bail-out of a regional lender over the weekend.
The Ibex 35 in Spain sank 3.1 per cent to 9,004.4, its lowest closing level since May 2009.
Europe's leading indices were also lower. France's CAC 40 shed 2.9 per cent to 3,331.29 while the Xetra Dax in Germany declined 2.3 per cent to 5,670.04 after news that Germany might widen the ban on speculative trades to cover all shares.