MADRID — Europe’s debt crisis cast its gloom over larger countries like Spain on Tuesday as investors sold off government bonds on worries that the euro currency region will be strained by more expensive bailouts.

The yields on Spain’s 10-year bonds jumped as high as 5.7 percent – a euro-era record difference of 3.05 percentage points against the benchmark German 10-year bond – before easing to 5.5 percent at the close.

The spread on Italy’s equivalent bond also reached the highest level since the 1999 launch of the euro, before falling back somewhat. Portugal’s bond yields, which soared last week, eased slightly but remained near record highs of 7 percent.

“Ireland’s bailout package has clearly failed to stop the rot in the eurozone markets and if anything it has focused attention on other countries in the periphery,” said Mitul Kotecha, analyst at Credit Agricole CIB.

The continued market turmoil “will come as a bitter blow to European officials who had hoped that (the bailout) would help to turn sentiment around,” he said.

Jose Manuel Campo, economy secretary at the Spanish Finance Ministry, sought to ease tensions and described the market reaction as “disproportionate.”

“It’s not necessarily worrying,” he told a parliamentary commission, but added that it would be of concern if it continued for some time as it would then make loans to the public more expensive.

He said investors’ lack of confidence “is poorly justified and based on a short-term analysis,” pointing out that there were major differences between Spain, Greece, Ireland and Portugal.

Spain and Portugal, deemed the next-weakest links in the eurozone economy, have continually denied they will need outside help, but investors have become increasingly skeptical that the series of bailouts will stop.

At the heart of the problem is that the austerity measures these countries need to take to reduce their deficits threaten to backfire by weakening economic growth and hurting state revenues. That is what’s happening in Greece, which has been able to drastically cut its spending but is struggling to raise tax income as economic and corporate activity wilts.

 

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