News / Europe

Spanish Bank Rescue Euphoria Fades on World Markets

Traders look at electronic boards at the stock exchange in Madrid, June 11, 2012.
Traders look at electronic boards at the stock exchange in Madrid, June 11, 2012.
VOA News
The initial euphoria on world financial markets about Europe's $125 billion bailout of Spanish banks faded quickly Monday as investors reconsidered terms of the rescue package.

Stock indexes in Tokyo and Hong Kong surged more than 2 percent, and markets in London, Frankfurt and Paris moved up sharply in early trading. By the end of the day, however, European markets ended little changed from Friday's closing prices. Major U.S. stock indexes all were down more than 1 percent.

Spain's key market, led by financial stocks, initially jumped 4 percent, but ended the day down one-half of one percent.

Analysts questioned whether the bank bailout would hurt the Spanish government, since it ultimately is responsible for repaying the loans, and its borrowing costs are increasing. Spain is in the third year of a recession. It has the highest unemployment rate in the 17-nation eurozone and is struggling to regain its economic footing.

Related video report by Henry Ridgwell

Spanish Bank Bailout Brings Relief - But For How Long?i
|| 0:00:00
X
Henry Ridgwell
June 11, 2012 7:36 PM
Spain’s prime minister has called the $125-billion loan from the European Union to prop up its banks a "victory" for his country and the EU. Stock markets surged Monday following the bigger-than-expected bailout. But as Henry Ridgwell reports, with potentially seismic shocks around the corner, analysts say the relief for the euro crisis could be short-lived.
Robert Halver of the Baader Bank said the rescue package has just given the eurozone a bit more time to resolve the crisis.

"Spain's problems have not been solved, they have just been moved. The clock for the the eurozone has turned back from five-to-12 to 10-to-12 so we won a little bit of time, but the main problem is still the Spanish economy and its inability to carry out reforms and that is something that needs to be worked on," Halver said.

Some Spanish workers said they see little gain with the bank bailout. One court employee, Felicia Lopez, said the policies of Prime Minister Mariano Rajoy are misguided.

"Rajoy's government is rescuing the banks giving them big amounts of money, and at the same time it is destroying citizens' lives, cutting salaries, cutting benefits, cutting basic rights," Lopez said.

Oil Prices Still Falling on Europe Crisis, Weak Global Prospects (Watch Related Video by Mil Arcega)

x
Oil Prices Still Falling on Europe Crisis, Weak Global Prospectsi
|| 0:00:00
X
Mil Arcega
June 12, 2012 1:22 AM
Oil prices edged lower again on Monday, erasing a 2 per cent gain last week on continuing worries over the ongoing economic crisis in Europe and slumping growth around the world. With oil consumption falling and inventories rising, some energy experts believe prices have not yet reached bottom. Mil Arcega takes a look at what that might mean for oil producers and consumers.

Oil Prices Still Falling on Europe Crisis, Weak Global Prospects (Watch Related Video by Mil Arcega)

In securing the bank rescue, Spain became the fourth eurozone nation to need a bailout, after Greece, Ireland and Portugal. On Monday, Cyprus, one of the smallest of the currency bloc countries, said it, too, could need assistance, possibly within days.

Greece is set for new parliamentary elections Sunday, after last month's vote proved inconclusive. A new government could become the first country to quit the 17-nation euro currency union rather than face austerity measures demanded by the International Monetary Fund and Greece's creditors across Europe.

Some information for this report was provided by AFP and Reuters.

You May Like

Video Is West Doing Enough to Tackle Islamic State?

There is growing uncertainty over whether West’s response to ISIS is adequate More

China Crackdown on Dual Citizens Causes Concern

New policy encourages reporting people who obtain citizenship in another country, but retain Chinese citizenship; move spurs sharp debate More

Video Coalition to Fight Islamic State Could Reward Assad

Losing ground to Islamic State fighters, Syria's government says it is ready to cooperate with international community More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Is West Doing Enough to Tackle Islamic State?i
X
Henry Ridgwell
August 29, 2014 12:26 AM
U.S. President Barack Obama has ruled out sending ground troops to Iraq to fight militants of the so-called Islamic State, or ISIS, despite officials in Washington describing the extremist group as the biggest threat the United States has faced in years. Henry Ridgwell reports from London on the growing uncertainty over whether the West’s response to ISIS will be enough to defeat the terrorist threat.
Video

Video Is West Doing Enough to Tackle Islamic State?

U.S. President Barack Obama has ruled out sending ground troops to Iraq to fight militants of the so-called Islamic State, or ISIS, despite officials in Washington describing the extremist group as the biggest threat the United States has faced in years. Henry Ridgwell reports from London on the growing uncertainty over whether the West’s response to ISIS will be enough to defeat the terrorist threat.
Video

Video Pachyderms Play Polo to Raise Money for Elephants

Polo, the ancient team competition typically played on horseback, is known as the “sport of kings.” However, the royal version for one annual event in Thailand swaps the horse for the kingdom’s national symbol - the elephant. VOA Correspondent Steve Herman in Samut Prakan reports that the King’s Cup Elephant Polo tournament is all for a good cause.
Video

Video Coalition to Fight Islamic State Could Reward Assad

The United States along with European and Mideast allies are considering a broader assault against Islamic State fighters who have spread from Syria into Iraq and risk further destabilizing an already troubled region. But as VOA State Department Correspondent Scott Stearns reports, confronting those militants could end up helping the embattled Syrian President Bashar al-Assad.
Video

Video Made in America Socks Get Toehold in Online Fashion Market

Three young entrepreneurs are hoping to revolutionize the high-end sock industry by introducing all-American creations of their own. And they’re doing most of it the old-fashioned way. VOA’s Julie Taboh recently caught up with them to learn what goes into making their one-of-a-kind socks.
Video

Video Americans, Ex-Pats Send Relief Supplies to West Africa

Health organizations from around the world are sending supplies and specialists to the West African countries that are dealing with the worst Ebola outbreak in history. On a smaller scale, ordinary Americans and African expatriates living in the United States are doing the same. VOA's Carol Pearson reports.
Video

Video America's Most Popular Artworks Displayed in Public Places

Public places in cities across America were turned into open-air art galleries in August. Pictures of the nation’s most popular artworks were displayed on billboards, bus shelters, subway platforms and more. The idea behind “Art Everywhere,” a collaborative campaign by five major museums is to allow more people to enjoy art and learn about the country’s culture and history. Faiza Elmasry has more.
Video

Video Chinese Doctors Use 3-D Spinal Implant

A Chinese boy suffering from a debilitating bone disease has become the first patient with a part of his spine created in a three-dimensional printer. Doctors say he will soon regain normal mobility. VOA’s George Putic reports.
Video

Video Uneasy Calm Settles Over Israel, Gaza Strip

Israel and the Gaza Strip have been calm since a cease-fire set in Tuesday evening, ending seven weeks of hostilities. Hamas, which controls Gaza, declared victory. Israelis were more wart. VOA’s Scott Bobb reports from Jerusalem.
Video

Video India’s Leprosy Battle Stymied by Continuing Stigma

Medical advancements in the treatment of leprosy have greatly diminished its impact around the world, largely eliminating the disease from most countries. India made great strides in combating leprosy, but still accounts for a majority of the world’s new cases each year, and the number of newly infected Indians is rising - more than 130,000 recorded last year. Doctors there say the problem has more to do with society than science. Shaikh Azizur Rahman reports from Kolkata.
Video

Video Scientists Unlock Mystery of Bird Flocks

How can flocks of birds, schools of fish or herds of antelope suddenly change direction -- all the individuals adjusting their movement in concert, at seemingly the same time? British researchers now have some insights into this behavior, which has puzzled scientists for a long time. VOA's George Putic has more.

AppleAndroid