Spain bailout fears intensify

Spain was battling last night to avert a fully-fledged sovereign rescue after borrowing costs spiralled out of control, with dangerous knock-on effects in Italy and Eastern Europe.

Louise Cooper, markets analyst at BGC Partners, has told Daybreak that Spain's large economy means that the cost of bailing out the country will run the hundreds of billions of euros.

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Germany's credit rating warning

Germany and the Netherlands have been put on negative ratings watch by Moody's. It is after increased fears about Spain's economy sent markets tumbling after news that the country was pushed deeper into recession and a step closer to a formal bailout