LONDON (MarketWatch)—Spanish stocks plunged to a three-year low on Friday, leading European stock markets lower, while disappointing growth data from China also slashed the buying appetite of investors. Shares dipped deeper into negative territory in afternoon trade after a surprise decline in U.S. consumer sentiment.
The Stoxx Europe 600 index sank 1.6% to 253.11, leaving it set to break a two-day winning streak.
The Spanish IBEX 35 tumbled 3.9% to 7,222.80, a level not seen since March 2009, after data showed Spanish banks sharply increased borrowing from the European Central Bank, underscoring the sector’s dependence on central-bank liquidity.
Bearishness is back in mode among investors, as U.S. and Chinese economic data pose questions about growth. Google, J.P. Morgan Chase and Wells Fargo all trade lower following financial results.
The IMF is raising its forecasts for global growth from levels it expected in January, but there is still a “high degree of instability” in the world economy, Managing Director Christine Lagarde says in an interview with the WSJ’s David Wessel.
