So much for the relief rally.
After bouncing overnight on news that Europe had stitched together a $125 billion rescue for Spain’s banks, gains for global stocks and the euro fizzled.
Bailouts for debt-strapped countries have provided a short period of comfort for investors, one that quickly gets eroded by fear about Europe’s vicious circle of slow or no growth and growing debt burdens. On Monday, the speed of that reversal was quicker than ever.
Greece’s first bailout in 2010 sparked a healthy 1.3 percent rally in the benchmark Standard