Updated 14:00

Zurich, Switzerland (GenevaLunch) - European markets reacted badly to weekend news that banks in Ireland, then Denmark and Austria are providing guarantees to savers, seeing it as a sign of a deepening financial crisis. Shares fell more than 5% during the morning on several markets, with Moscow suspending trading late in the morning for an hour when share prices dropped 7.60% and 9.60% in 20 minutes on the RTS and Micex indexes; oils prices also fell (TSR, Fre and Bloomberg) .

Bank shares fell sharply, following Aisan markets, including those of Switzerland’s UBS, down more than 10% in the first hours of trading (see Financial Times and TSR (Fre) reports). BNP Paribas took over control of Fortis, the troubled Belgian financial group, and in Germany the country’s fourth largest bank, Hypo Real Estate, was saved from bankruptcy by the government over the weekend.

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