The FTSE 100 has fallen by over 5 per cent this week amid continued concerns over Greece and Spain.
The blue-chip index ended the week down 5.52 per cent, to stand at 5267.62. European markets also suffered with the German Dax down 4.7 per cent and the French Cac 40 down 3.9 per cent this week.
European banks took a major hit yesterday after ratings agency Moody’s cut the credit ratings of 16 Spanish banks. It also cut the debt rating on Santander UK, a subsidiary of the Spanish banking giant.
Markets have also been hit by the political crisis in Greece where politicians are preparing for the second election in six weeks. Greece announced on Wednesday that it is set to hold fresh elections on June 17. Council of State president Panagiotis Pikramenos will head the caretaker government until the election.