Bailout fears grow over Spain

(AP) MADRID - The yield on Spain's 10-year government bonds shot past the 6 percent mark on Monday, as fears rose that the country may eventually need a financial bailout.

The rate jumped to 6.10 percent on the secondary market, according to financial data provider FactSet. It had closed at 5.93 percent Friday after a week of persistent market tension.

Monday's rate is the highest since the new conservative government took office in December. Although the government has implemented a barrage of labor and financial reforms, investors remain worried about Spain because banks are saddled with bad loans from a collapsed property market and regions' have high debts.

Spain is worse off than Greece two years ago
Spain's collapsing economy poses risks to U.S.

The 10-year bond yield surged toward 7 percent late last year, a rate considered unsustainable for a country over a long period. Greece, Portugal and Ireland had to ask for bailouts after their yields stayed above 7 percent.

The jitters in bond markets on Monday extended to Italy, viewed as another weak link in the 17-nation eurozone. Its 10-year bond yield rose to 5.60 percent from about 5.50 percent on Friday.