* Euro hits 10-week low vs dollar <EUR=>; eyes $1.30
* Spanish, Italian yield spreads rise to new highs
* World stocks struggle; European shares in volatile session
By Tamawa Desai
LONDON, Nov 30 (Reuters) - The euro hit a 10-week low
against the dollar and world stocks struggled on Tuesday as euro
zone debt problems weighed on investor sentiment even after
Ireland's bailout.
The premium investors demand to hold Spanish and Italian
sovereign bonds over German bonds hit their highest since the
euro's launch while some of the region's "core" debt issuers,
including France, were pressured.
An 85 billion euro package for Ireland announced on Sunday
did little to stem fiscal concerns, as speculators targeted
other debt-laden countries.
"Speculators are targeting Italy and Spain and are not going
to stop. We haven't seen any selling from real money (accounts)
yet, they're all very nervous but haven't started selling, when
they do it's going to be a wash," one Italian trader said.
The spread between Spanish 10-year bond yields <ES10YT=TWEB>
over those of Germany <DE10YT=TWEB> widened by 20 basis points
to 297 basis points, while Italian 10-year spreads <IT10YT=TWEB>
rose for a fourth day to 210 basis points.
Yields on the 10-year Spanish bond <ES10YT=TWEB> rose for
the eleventh consecutive session to 5.65 percent, while Italian
10-year debt yields <IT10YT=TWEB> rose to 4.77 percent.
The euro fell as low as $1.3016, down 0.7 percent on the
day, and its lowest since late September.
"The euro has had a hard fall and has not been lifted by the
finalising of the Irish rescue deal," said Stephan Maier,
currency strategist at Unicredit in Milan.
FRAGILE SENTIMENT
European shares drifted as concerns about euro zone
peripherals weighed on sentiment. The FTSEurofirst 300 <>
index of top European shares was flat at 1,068.46 points.
"Sentiment remains very fragile, with difficulties in Europe
still dominating and investors quick to book profits," said
Keith Bowman, equity analyst at Hargreaves Lansdown.
Japan's Nikkei <> slid 1.9 percent and the MSCI
ex-Japan index <.MIAPJ0000PUS> fell 0.4 percent on Tuesday.
MSCI's all country world index <.MIWD00000PUS> was down 0.2
percent on the day.
U.S. Treasury prices rose, adding to the previous day's
gains, as investors turned to government debt as a safe haven
from the recent flare-up in volatility.
Spot gold <XAU=> was a touch higher at $1,369 an ounce,
while oil slipped, retracing part of the sharp gains in the
previous session.
(Additional reporting by Amanda Cooper, Atul Prakash and
Jessica Mortimer, editing by Mike Peacock)
