The MSCI Latin American stock index dropped 0.74 percent, adding to two previous sessions of losses. The MSCI's moving average convergence divergence, a technical indicator of momentum also known as MACD, has moved into territory suggesting a selloff ahead. Despite bond buying by the European Central Bank to stop a selloff, the yield on Italian 10-year bonds continued to hover near 7 percent, the level many consider unsustainable. Yields on core euro zone bonds issued by France, the Netherlands and Austria also rose as investors fretted about the ability of euro zone policymakers to end the crisis. While Ireland, Portugal and Greece have all received bailouts in the two-year-old euro zone sovereign debt crisis, Italy is a much larger economy, the third biggest in the 17-nation monetary union. "If Greece caused all this damage, what could Italy do?" said Alexandre Montes, an analyst with consultancy Lopes Filho e Associados. "A recession in Europe is a certainty. Same with the United States. And China is going to slow down more," he added. A slowdown in Europe could hurt one of China's major export markets, braking Asia's biggest economy, which is itself a major buyer of key Latin American commodities such as soy, iron ore and copper. "For those who believe in that sort of thing, I advise a lot of prayer," Montes added. Brazil's benchmark Bovespa stock index retreated 0.56 percent after a market holiday on Tuesday. The index fell below its 14-day simple moving average, which had helped limit losses earlier in the week, as its MACD also deepened into sell territory. Shares of homebuilder Gafisa sank 4.9 percent after the company reported its third-quarter net income tumbled. Meatpacker JBS dropped 2.96 percent after the company posted a net loss in the third quarter, reversing a profit a year earlier. Chile's IPSA index gave up 0.3 percent, with the IPSA's MACD near to flashing a sell signal. Retailers helped lead losses, with Falabella off 0.93 percent and Cencosud dipping 0.75 percent.