Europe, Europe Debt Crisis | featured news

Italy and Spain pass new measures as they battle to control their debts while Greece steps up its austerity plans.

While many of the ideas have yet to hit official agendas, officials say there has been a substantial step-up in planning for a closer European fiscal relationship.

The Portuguese government is planning the country's biggest spending cuts in 50 years, a move it described as "unprecedented".

By insisting that it receive collateral from Greece in return for aid, Finland threatens to upend an agreement that euro zone countries made in July to expand the E.U. bailout fund.

U.S. President Barack Obama and German Chancellor Angela Merkel discussed the eurozone crisis and financial-market turbulence on Saturday and vowed action to bolster the global economy, the White House said in a statement.

Several European countries that banned short-selling have extended the prohibition until the end of September. When concerns about European banks’ exposure to Greek debt sent their stocks plummeting two weeks ago, market regulators in Belgium, France, Greece, Italy and Spain stepped in to prohibit traders from betting on the decline in a share’s price.

Stock markets in Asia opened sharply lower Friday amid signs of a possible U.S. recession and renewed worries over the financial health of Europe's banks.

As markets continued to hammer Italy, Prime Minister Silvio Berlusconi rebutted calls for his resignation, saying Italy’s economic fundamentals were strong.

Standard & Poor's cuts Greece's credit rating, saying eurozone plans to restructure the country's debts would constitute a default.

European leaders are holding an emergency summit on Greece's debt crisis, trying to prevent a meltdown for the euro and a global economic slump.