A look at economic developments around the globe

AP News
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Posted: Jun 11, 2012 4:49 PM
A look at economic developments around the globe

A look at economic developments and activity in major stock markets around the world Monday:

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MADRID _ Euphoria over a lifeline of up to (EURO)100 billion ($125 billion) to rescue Spain's troubled banks morphed into a financial markets rout in a matter of hours, as investors digested the still-undefined plan and became concerned the country may be unable to repay the new loans.

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MILAN _ Official statistics confirm that Italy's economy contracted by a quarterly rate of 0.8 percent in the first three months of the year, the worst contraction in three years.

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LONDON _ A global market rally over a promised European bailout of Spanish banks faded as investors worried the country might have trouble paying the money back.

Madrid's Ibex stock index closed down 0.5 percent. France's CAC-40 ended the day down 0.3 percent and the FTSE index of leading British shares fell 0.1 percent. The DAX in Germany eked out a 0.2 percent gain.

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TOKYO _ In Asia, Japan's Nikkei 225 index climbed 2 percent. South Korea's Kospi added 1.7 percent and Hong Kong's Hang Seng rose by 2.4 percent. Benchmarks in Singapore, Taiwan, mainland China, Indonesia and New Zealand also rose.

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FRANKFURT, Germany _ Germany has borrowed again at rock-bottom interest rates. The government auctioned (EURO)4 billion ($4.99 billion) in six-month treasury bills at an average annual interest rate of only 0.007 percent.

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LONDON _ Britain's Treasury chief has warned that uncertainty over the future of Europe's single currency is threatening to keep his country from returning to economic growth.

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