Spain beset by bank crisis, downgrades, bond pressure

MADRID (Reuters) - Spain's borrowing costs shot up at a bond auction on Thursday and its troubled banks suffered a double blow, with shares in part-nationalized Bankia diving and 16 lenders - including the euro zone's biggest - having their credit ratings cut.

Poll shows Greece electing pro-bailout government

ATHENS (Reuters) - Greek voters are returning to the establishment parties that negotiated its bailout, a poll showed on Thursday, offering potential salvation for European leaders who say a snap Greek election next month will decide whether it must quit the euro.

Russia says action on Syria, Iran may go nuclear

MOSCOW (Reuters) - Russian Prime Minister Dmitry Medvedev warned on Thursday that military action against sovereign states could lead to a regional nuclear war, starkly voicing Moscow's opposition to Western intervention ahead of a G8 summit at which Syria and Iran will be discussed.

France's left-wing leadership starts with a pay cut

PARIS (Reuters) - France's new left-wing government started work on Thursday with pledges to combat excessive austerity but better manage public finances, marking the debut with a 30 percent cut in pay for President Francois Hollande and all ministers.

Qaeda chief urges Saudis to topple ruling family

DUBAI (Reuters) - Al Qaeda chief Ayman al-Zawahri on Thursday urged Saudis to rise up against the kingdom's ruling Al-Saud family, suggesting they draw inspiration from uprisings that have deposed leaders across the Middle East and Africa in the past year and a half.

Syria's Assad: Nations that sow chaos will suffer

AMMAN (Reuters) - Syrian President Bashar al-Assad said on Wednesday that countries trying to "sow chaos" in Syria could be infected with it themselves, an apparent warning to Arab Gulf nations that back the insurgency aimed at forcing him from power.

Judge holds Mexican generals over for drug probe

MEXICO CITY (Reuters) - A Mexican judge on Thursday ordered the former deputy defense minister and a top general to be held for 40 days while they are investigated for alleged ties to drug cartels.

Greek winemakers see crisis as glass half-full

NEW YORK (Reuters) - Greek winemakers are not pricing their wares in drachmas - yet.

Russian police detain protest leader, five others

MOSCOW (Reuters) - Russian riot police detained a prominent protest leader and five other demonstrators on Thursday as authorities extended a crackdown on Occupy-style protests in central Moscow against newly-inaugurated President Vladimir Putin.

U.S. suspends sanctions on investment in Myanmar

WASHINGTON (Reuters) - The United States on Thursday suspended sanctions barring U.S. investment in Myanmar in response to political reforms in the poor southeast Asian state, drawing praise from some U.S. lawmakers but criticism from human rights advocates.