Stock Markets Slump After Violent Protests In Spain And Greece (PICTURES)

Stock markets slumped across Europe today as mounting concerns over Spain and fresh strike action in Greece sent investors heading for the exit.

London's FTSE 100 Index fell 1.5%, while the Cac 40 in France was 2% lower and Germany's Dax dropped 1.9% as eurozone crisis fears escalated.

Uncertainty over whether Spain will accept the terms of a bail-out sparked the latest sell-off, following violent riots in the country and as strikers again took to the streets in Greece to protest against austerity measures.

Violence in Greece and Spain has affected stock market confidence

Investors were also spooked by a member of the US Federal Reserve casting doubt on the effectiveness of its economy-boosting efforts, which sent the Dow Jones Industrial Average on Wall Street more than 100 points lower overnight.

An uncertain start to trading on the Dow today fuelled the rout in London and Europe.

Spain's central bank said the country's gross domestic product continued to fall at a "significant rate" in the third quarter.

Worries over Spain caused 10-year bond yields to rise above 6% for the first time since the European Central Bank outlined plans to intervene in the European bond market earlier this month.

The stock markets took a hit on Wednesday in response to the turmoil

Banks and financial stocks were among the worst hit on the FTSE 100, with Royal Bank of Scotland and Barclays down 5%, while Lloyds Banking Group dropped 4%.

In the insurance sector, RSA fell 4%, Aviva shed 3% and Prudential was 2% lower.

There were only a small handful of blue-chip firms in positive territory, with investors fleeing to defensive stocks such as cigarette maker British American Tobacco, up 0.4%.