LONDON: German Bund futures hit new record highs and European stocks extended losses on Thursday, with traders citing talk of possible credit ratings downgrades for Spanish banks circulating in the market. "We've got some talk of downgrades in Spain and we are still in the same old negative mood because of Greece," one trader said. Bund futures were last 143.79, up 61 ticks on the day. Spain's Ibex 35 and the pan-European FTS Euro first 300 index hit session lows and were now trading 2.4 percent and 1.3 percent lower, respectively.   Copyright Reuters, 2012   ...

LONDON; German Bund futures hovered near their record highs on Thursday as the risk that Greece could leave the euro zone unnerved investors before a closely watched Spanish debt auction later in the day. Federal Reserve minutes showing several policymakers last month thought the US central bank might need to do more to support the economy offered some relief to investors, and European stocks were seen opening flat as well. Meanwhile, the European Central Bank has stopped offering liquidity to some Greek banks it does not consider solvent, heightening fears that Athens is on the brink of collapse as it heads into a June election re-run expected to be won by anti-bailout politicians. The volatile mood bodes ill for a Spanish auction of 1.5 to 2.5 billion euros of 2015 and 2016 bonds. Domestic banks are expected to provide support in the sale given its small size and the short maturities on offer. But ...

MADRID: The spread, or difference in interest rates, between 10-year Spanish and German bonds hit a record high in early trading on Wednesday, underscoring fresh fears of contagion in the eurozone debt crisis. The rate on 10-year Spanish bonds jumped to 6.495 percent, while the benchmark German Bund traded near an all-time low of 1.443 percent. Italian bonds approached the psychologically key six-percent mark, at 5.946 percent. Ten-year borrowing costs of greater than six percent are widely considered to be unsustainable in the long term. Italy and Spain are suffering "contagion" effects from the Greek debt crisis because investors wonder if the two much bigger eurozone economies will also end up in dire financial straits, and have to default on their debts. The market's reaction is to "seek shelter in safe assets, which is to say German debt," economists at BNP Paribas explained in a research note. "This trend is likely to endure," the analysts forecast. Copyright ...