EUROPEAN CENTRAL BANK

Political and economic crisis in Italy spurred fears of a split in the Eurozone with borrowing costs for Europe's third biggest economy at unsustainable levels and the bloc unable to afford a bailout.

Asian stocks fell sharply Thursday after soaring Italian borrowing costs stoked fears the debt crisis in the euro zone's third biggest economy will overwhelm its financial defenses, raising the risk of a break-up of the currency area.

The Dow Jones Industrial Average (DJIA) registered another difficult day Tuesday, plunging 389 points to 11,781 on institutional investor concern that Italy will not be able to service its debt, and that one, and possibly more countries may leave the Eurozone. What's the prudent stance for the typical investor?

U.S. stocks plummeted Wednesday in a global stampede toward investments perceived as capable of withstanding a severe European downturn, or worse.

The talks have now dragged on for three fruitless days.

We have agreed on someone who will unite us, Papandreou reportedly said, without revealing his identity.

Global markets stampeded Wednesday after the bond market signaled that Europe's third-largest economy can no longer survive without a rescue.

The major European bourses are down anywhere from 2.0 percent to 2.6 percent.

Stocks dropped more than 2 percent in early trading on Wednesday as a spike in Italian bond yields prompted fears the region's debt crisis was spiraling.

Germany's wise men panel of economic advisers warned the European Central Bank it risks losing credibility by buying the bonds of heavily-indebted euro zone states, and that monetary and fiscal policy are becoming worryingly blurred.

Negotiations between outgoing Prime Minister George Papandreou and opposition leaders, notably Antonis Samaras, have dragged on into the third day.

Germany's wise men panel of economic advisers warned the European Central Bank it risks losing credibility by buying the bonds of heavily-indebted euro zone states, and that monetary and fiscal policy are becoming worryingly blurred.

The euro zone debt crisis kicked into a new gear on Wednesday as Italian bond yields soared into levels widely deemed unsustainable, causing a sharp sell-off in stocks and the euro.

Italian borrowing costs reached breaking point on Wednesday after Prime Minister Silvio Berlusconi's promise to resign failed to raise optimism about the country's ability to deliver on long-promised economic reforms.

Gold prices slipped Wednesday as skyrocketing Italian government bond yields signaled the beginning of a possibly terminal phase in that nation's economy.

Stock index futures tumbled on Wednesday as a spike in Italian bond yields sparked fears the country will need a bailout, ratcheting up the region's debt crisis to another level.

Greek political leaders were scrambling Wednesday to agree on new prime minister to lead the country back from the brink of bankruptcy, after a plan to name a former European Central Bank official appeared to fall apart.

I believe that we are now close to an agreement with [the opposition party] New Democracy, Papandreou said during a Cabinet meeting

Financial markets held their breath on Tuesday as Italian Prime Minister Silvio Berlusconi's reform-shy government teetered on the brink and debt-crippled Greece's leaders struggled to put together a national unity government.

Stock index futures rose on Tuesday as lawmakers in Rome readied for a crucial vote on public finances that marks the latest chapter in the euro zone debt crisis.