Standard & Poor’s downgraded Spain's credit rating two levels to BBB-, just one level above junk, from BBB+ on Wednesday.
However, economic data from Europe on Wednesday were surprisingly good. Industrial production jumped in August in France and Italy by 1.5 percent and 1.7 percent respectively.
In the US, the Federal Reserve's Beige Book reported that the economy expanded “modestly” last month.
Still, markets fell on Wednesday. The MSCI All-Country World Index fell 0.6 percent, its third consecutive decline. The S&P 500 also fell 0.6 percent to close at 1,432.63, its lowest level in a month.