The yield on the comparable Italian bond crept higher, too — by 0.28 percentage point from Friday to 5.83 percent.
Finance ministers of the 17 countries that use the euro currency said they would make the $120 billion available to the Spanish government to distribute to its banks.
Bond investors were worried that the debt from the rescue package would put additional strain on Spain’s finances. The European Union made clear Monday that there would be some strings attached besides interest.
“When people lend money, they never do it for free. They want to know what is done with the money,” said Joaquin Almunia, the European Competition Commissioner.
Adding to the economic fear, Italy said its economy contracted by 0.8 percent in the first three months of the year, the worst showing in three years. The Italian government is struggling to fend off the perception that Italy will be next to need a rescue.
The price of oil reversed an earlier gain, falling 65 cents to $83.46 a barrel. Investors bought safer investments like U.S. Treasury notes, sending the yield on the benchmark 10-year note down to 1.59 percent from 1.64 percent Friday.
Also adding to market worries was China’s economic slowdown. A large steelmaker in China, Baoshan Iron & Steel, said it lowered steel prices as demand from makers of appliances and cars slowed.
“China is a big piece of the global economic puzzle,” Herrick said. “Any piece of news that comes out from there will be closely scrutinized.”
The news sent stocks of steelmakers sharply lower. U.S. Steel fell 6.5 percent, while AK Steel Holding fell even further, 14 percent, after its stock was downgraded by an analyst on similar concerns.
Apple stock fell $9.15, or 1.6 percent, to $571.17, as investors appeared unimpressed by what the company unveiled at a conference for software developers in San Francisco.
Apple showcased a new operating system for the iPhone, a thinner MacBook Pro laptop and other products. Apple traded as high as $588.50 earlier.
Among other stocks making big moves on Monday:
• Micronetics Inc. nearly doubled, rising $7.10 to $14.59 after the maker of microwave and radio frequency components agreed to a takeover by Mercury Computer Systems Inc.
• EnergySolutions fell $1.97, or 55 percent, to $1.62 after the nuclear industry service company appointed board member David Lockwood as its new chief executive, and lowered its full-year adjusted earnings estimate.
• Progress Energy rose $1.47, or 2.5 percent, to $59.60 after federal regulators cleared Duke Energy’s proposed takeover of the company, a deal that will create the nation’s largest electric utility.
By Elaine Donnelly
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