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| Version 1 | Version 2 |
|---|---|
| Global stock markets hit by Portuguese bank concerns | Global stock markets hit by Portuguese bank concerns |
| (35 minutes later) | |
| Stock markets in Europe and the US have fallen over concerns about the health of one of Portugal's biggest banks. | Stock markets in Europe and the US have fallen over concerns about the health of one of Portugal's biggest banks. |
| Shares in Banco Espirito Santo were suspended after falling 17% following concerns about accounting irregularities at its parent group. | Shares in Banco Espirito Santo were suspended after falling 17% following concerns about accounting irregularities at its parent group. |
| As a result, the Lisbon stock exchange fell more than 4%, Madrid's IBEX was down 2.7%, while the Paris Cac 40 and Frankfurt's Dax were both 1.8% lower. | As a result, the Lisbon stock exchange fell more than 4%, Madrid's IBEX was down 2.7%, while the Paris Cac 40 and Frankfurt's Dax were both 1.8% lower. |
| Wall Street also opened sharply lower, with the Dow Jones falling 150 points. | Wall Street also opened sharply lower, with the Dow Jones falling 150 points. |
| This took the index well below 17,000, the level breached for the first time earlier this month. | |
| Media reports highlighting concerns about certain financial practices at the Espirito Santo group surfaced at the end of last year. | Media reports highlighting concerns about certain financial practices at the Espirito Santo group surfaced at the end of last year. |
| Portugal's central bank then ordered an audit into the group's accounts, which uncovered "serious" accounting irregularities. | Portugal's central bank then ordered an audit into the group's accounts, which uncovered "serious" accounting irregularities. |
| The Portuguese government has said that Banco Espirito is isolated from problems at its parent, which is registered in Luxembourg, and that public finances are not at risk. | |
| Renewed concerns | Renewed concerns |
| "This Espirito Santo case has been simmering for some time, but is clearly now bursting out into the open and is obviously a troubling development for a country that has just exited its bailout programme," said Nicholas Spiro, head of Spiro Sovereign Strategy in London. | "This Espirito Santo case has been simmering for some time, but is clearly now bursting out into the open and is obviously a troubling development for a country that has just exited its bailout programme," said Nicholas Spiro, head of Spiro Sovereign Strategy in London. |
| At the height of the financial crisis, Portugal was forced to take a 78bn euro ($106bn; £62bn) bailout from its European partners and the International Monetary Fund. | At the height of the financial crisis, Portugal was forced to take a 78bn euro ($106bn; £62bn) bailout from its European partners and the International Monetary Fund. |
| Portugal exited the bailout programme last month as confidence in the country's economy returned. | Portugal exited the bailout programme last month as confidence in the country's economy returned. |
| Government borrowing costs fell to an eight-year low of 3.58% in April this year, but renewed concerns about the health of the country's financial sector pushed these back up towards 4% on Thursday. | Government borrowing costs fell to an eight-year low of 3.58% in April this year, but renewed concerns about the health of the country's financial sector pushed these back up towards 4% on Thursday. |
| Some commentators suggested the specific concerns about Banco Espirito fed into wider fears about the health of the eurozone economy. | |
| "What really hurts shares today... are worries that the economic recovery in the eurozone might be already weakening again," said Markus Huber at Peregrine and Falcon. | |
| "Latest economic data out of Germany and also today from France and Italy are clearly seeming to point this way." |