Europe Debt, Europe Debt Crisis | featured news

European leaders faced increasing pressure on Thursday to respond to the euro crisis, as Spanish bond yields hit a level that has triggered full bailouts of other nations.

Greece looks close to bolting from the European Union with national elections this weekend. Spain’s banks were just bailed out, and Italy might be next. And, closer to home, Wall Street is still reeling about May’s crummy jobs report. So you’d think U.S. stocks would be tanking? Nope. Welcome to the bad-news rally: The Dow Jones industrial average shot up more than 160 points on Tuesday.

Spain’s borrowing costs soared Tuesday to levels that have sent other euro members into the arms of international lenders, calling into question the viability of a bailout deal for Spain’s banking sector even as other troubled countries were weighing whether they could make similar rescue arrangements.

European finance officials have discussed limiting the size of withdrawals from ATM machines, imposing border checks and introducing euro zone capital controls as a worst-case scenario should Athens decide to leave the euro.

Investors fled from Spanish government debt on Monday, an immediate rejection of the country's planned bank bailout by the constituency it most desperately needs to impress: the buyers of its own government bonds.

The average price for a gallon of regular gasoline in the United States fell 15.9 cents to $3.624 in the past three weeks due to a drop in crude oil, which took a hit from fears over Europe's economy and a stronger dollar, the Lundberg Survey showed. The national average for regular gasoline as of June 8 was down more than 11.62 cents from the year-earlier level of $3.74 a gallon, according to the survey of some 2,500 gasoline stations in the continental United States.

Britain's Treasury chief says that uncertainty over the future of Europe's single currency is threatening to keep Britain from returning to economic growth.

To every Portuguese, the town of Grandola is a cradle of the 1974 revolution that ended decades of dictatorship, but nowadays it is hard to find even a spark of revolt here against the worst economic hardship in the country's recent history.

Europe agreed Saturday to allow Spain to tap a rescue fund of up to (EURO)100 billion ($125 billion) to bail out its troubled banks, which are struggling under the weight of soured real estate loans after a Spanish housing bubble burst. Spanish Economy Minister Luis de Guindos said the country will reveal how much money it needs within coming weeks, after audits of its financial sector are completed.

Spain could ask for a rescue of its struggling banks this weekend when European finance ministers hold an emergency conference call Saturday to discuss the country's financial problems, a move that would make it the fourth member of the 17-nation eurozone to seek outside help since the continent's debt crisis erupted two years ago.