After a long simmer, Europe's debt crisis is coming to a boil.
The market has turned against the Continent with a vengeance. European bank stocks sold off for the second straight day, while the euro sank against both the dollar (see chart, right) and the Swiss franc.
The euro hit $1.41, down a nickel from its recent high just ahead of the July 4 holiday here. Big European financial companies, ranging from Deutsche MOREColin Barr - Jul 11, 2011 11:47 AM ET
A panic of sorts is sweeping through European trading desks concerning all things Italian. A sovereign default in the world's third-largest public debt market would be catastrophic.
By Cyrus Sanati, contributor
FORTUNE -- With the Greek crisis coming to a head this week, traders in Europe have started to worry about the fiscal health of other eurozone members. Now the worry has moved up the scale to one of the core eurozone MOREJun 28, 2011 10:18 AM ET
A whole day without European debt fireworks is too much to ask for, apparently.
Moody's said Friday that it may downgrade Italy's debt, thanks to "fragile market sentiment" for deeply indebted European governments. It is the first downgrade warning for one of the stronger European economies since the Greek debt crisis flared up this spring.
The rating agency said that as investors grow more risk averse, Italy -- currently rated Aa2, the second-highest rating -- MOREColin Barr - Jun 17, 2011 3:47 PM ET
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