World stocks fell to eight-week lows and the euro hit a one-year trough on Wednesday as investors fretted that a debt crisis would spread to other euro zone countries, following a massive bail-out for Greece.

The European Union and International Monetary Fund agreed a 110 billion euro aid package for Greece at the weekend, but the promise has failed to calm markets.  Shares in Spain and Portugal, two of the weaker euro zone members, fell 2 per cent, and the FTSEurofirst 300 index of leading European shares dropped 0.75 per cent to two-month lows.  The euro, which suffered its steepest one-day loss since last June on Tuesday, notched up another one-year low at $1.2936 .

In Athens, striking public sector workers challenged Greece’s bailout-for-austerity deal, while policymakers, including IMF chief Dominique Strauss-Kahn and the European Central Bank’s Axel Weber, warned of the dangers of contagion to other high-debt euro zone nations