European shares have fallen as the impact of the crisis in Catalonia spread from Madrid and Spanish banks to the wider industry and euro zone region. As Silvia Antonioli reports, Spain's IBEX was set for its worst day in 14 months and Spanish government borrowing costs rose to their highest since March.
The more Catalan separatists wave their red and yellow flags the more Spanish markets see red Spain's IBEX was set for its worst day in over a year after Catalan leader Carles Puigdemont's said he was ready to declare indepenece within days Fears of a split have grown since a vote on Sunday- declared illegal by Madrid- that saw the vast majority of voters support independence And Catalans' protests have risen even louder since the violent police crackdown that injured 9-hundred SOUNDBITE (English) Charles Stanley, Chief Investment Commentator, Garry White: "It's going to get very, very messy. It's been handled very badly. Mr Rajoy is gonna look pretty awful in history, I suspect, after the events of this weekend." Catalan banks Caixabank and Banco de Sabadell were victims with their shares once again among the biggest losers. Caixabank and the Spanish economy minister had to reassure customers their deposits were safe SOUNDBITE (English) Charles Stanley, Chief Investment Commentator, Garry White : "I think it's right for people to be cautious but ultimately we think there will be a resolution to the issue. It's very difficult to call these things and over the last few years I've called referendums wrong. So you know when you come into these political situation it's very difficult." Fears of a split weighed on government borrowing costs too and not only for Madrid Spanish worries spread to Rome, pushing the Italian spread with the German 10-year bund to its widest since June And as Catalans seek some external help with their cause the EU calls for a peaceful resolution, in the best interest of Spain, and its own.