The extent of investors' concern about the news from the emirate pushed Britain's leading stock market index down 3.2%, the biggest daily fall in nearly nine months.

The concern over bonds infected the stock market where Italian Banks, leading holders of their country's debt, were particularly badly hit.

Rather than being a leading indicator of an economic recovery, a growing suspicion is the A-share move is due to the huge bank stimulus lending being funneled into the stock market.