Markets rocked by eurozone contagion fears

UPDATE 9am: Global stockmarkets have almost doubled losses seen in early trading on growing concerns the debt crisis in the eurozone may spread to Italy and Spain.

In London the index of 100 leading shares was down 1.97% at 5,839.57 by 9am.

At the same time across Europe the German Dax had plummeted 2.18% to 7,072.39. The French Cac 40 was down 1.93% to 3,733.90.

Across the Atlantic, the US the Dow Jones closed down 1.2% at 12,505.76, having dropped 151.44 points.

In Asia, Japan's main Nikkei share index was down 1.5%, while Hong Kong's Hang Seng was 2% lower.

The declines came after European stock markets fell heavily on Monday, especially in Italy, where the market in Milan lost 4%.

On Monday, eurozone finance ministers conceded Greece was likely to default on its debts, but said they were ready to pass new measures to stop the crisis spreading.

The concern is that Italy and Spain may have to follow Greece, Portugal and the Republic of Ireland and seek a European Union and International Monetary Fund (IMF) bail-out.