Internaional banks are scrambling to sell their holdings of Spanish mortgage debt at a steep discount, fearing that the country may be sliding into the worst economic downturn in its modern history. Daily Telegraph

A blizzard of grim data has soured the mood, capped yesterday by a plunge in PMI purchasing managers' index to an all-time low of 40.9. Car sales fell 28% in March, and even Madrid’s legendary tapas bars seem to have lost their late-night sparkle.

Inmobiliaria Colonial – once the country’s biggest property group – is in talks with banks after Dubai's Investment Corporation pulled out of a rescue deal.

Developer Martinsa Fadesa is struggling to restructure €5bn of debt to stave off insolvency.