Expatica news

Spain’s markets see red over fears for US lenders

20 August 2008

MADRID – Fears that the worst of the global financial crisis may still be lurking around the corner drove the Spanish stock market to its sixth-biggest loss of the year Tuesday as banks and builders turned indexes red.

The blue-chip laden Ibex 35 gave up 2.93 percent, leading Europe in a day of heavy losses triggered by declines on Wall Street on Monday.

Investors are fearful that the financial problems stemming from subprime lending that hit banks last year are coming back to haunt the sector amid rumours that more lenders could fail in the United States.

That hit bank stocks in Spain in the wake of data Monday showing a surge in non-performing loans here, while shares of constructors also suffered amid few signs that Spain’s rapidly deflating property market will recover anytime soon.

[EL Pais / Ángeles Espinosa / Expatica]

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