User: SaJeDoe: Europe: BBC News - Spain bond yield spread at record high as Bankia shares drop

The difference between the price investors will accept for Spanish and German bonds has hit a record high.

Bond markets continue to reflect the tensions in the eurozone with 10-year German bond yields at 1.38% and Spain's 5.05 percentage points higher than them.

Italian government bond yields also ticked higher, rising to 5.87%.

Shares in Spain's Bankia fell 27% after it requested a 19bn euro ($24bn, £15bn) bail-out on Friday.

Its shares had been suspended on Friday pending the funding request.

Spain's blue-chip Ibex index fell 1%.

The amount Bankia needs in state aid was higher than had been feared.

It marks an effective nationalisation for the country's third-largest bank and has raised fears about how Spain plans to pay for it.

The country's economy is in difficulties, with government borrowing at an almost unsustainable price.

Bond yields, which are an indicator of the amount government would have to pay to borrow money, are just short of the 7% deemed unaffordable.

Bankia is estimated to have 32bn euros in toxic assets.

Just under a year ago the Bank of Spain injected 4.5bn euros in rescue funds into Bankia.

Despite the worries about Spain, other European stock markets opened higher.

Shares were boosted after a weekend poll in Greece showed growing support for a pro-austerity conservative party.

The poll suggested the New Democracy party could gain about a quarter of the votes, leaving it as the biggest party, albeit without overall control.

Greek shares bounced back by 2.6% in Monday morning trading. The next elections are scheduled for 17 June.

London, Paris and Frankfurt markets all rose at least 1% at the start of trading, before trimming gains to be about 0.7% higher.

Although both Germany and France have a public holiday on Monday, their equity markets remain open.