Spain's weak banks need at least 40 billion euros ($50 billion) in new capital to strengthen against severe financial shocks, the International Monetary Fund said.

Stress tests performed by the IMF on the country's battered banking sector indicated the top two banks, BBVA and Banco Santander, were solid.

U.S. President Barack Obama called Friday for urgent, decisive action by Europe's leaders to beat back the economic crisis, as he urged Greeks ahead of elections to stay in the Eurozone.

Speaking as European officials worked on a huge rescue plan for Spain's feeble banks, Obama said he was confident EU leaders appreciated the severity of a crisis that weighs heavily on his prospects of reelection in November.

Shares in flagship Australian airline Qantas dropped below Aus$1 (98.5 U.S. cents) Friday for the first time since the carrier's float in 1995 after it was put on credit watch by Standard & Poor's.

The embattled airline's stock plunged as low as 96.2 cents -- a fall of more than nine percent -- after S&P put its BBB/A-2 investment-grade rating on credit watch negative following warnings this week of a huge profit slump.

Cyprus's Eurozone economy will shrink by 1.1 percent in 2012, the central bank forecast on Thursday, a more pessimistic outlook than the zero growth seen in December.

After suffering a year-long recession, Cyprus can only expect "anemic growth" of 0.4 percent next year, the bank added.

China's president pledged "selfless help" to Afghanistan on Friday and the leaders of the two nations agreed to upgrade their ties, as NATO-led forces prepare to withdraw from the war-torn country in 2014.

Hu Jintao told visiting Afghan President Hamid Karzai that China would "continue to provide sincere and selfless help to the Afghan side" as it entered "a critical transition period".

Spain paid sharply higher borrowing costs to lure buyers for its bonds Thursday as the crisis-torn banking sector tottered towards a bailout.

The treasury raised 2.074 billion euros ($2.6 billion) in the auction of two-, four- and 10-year bonds, comfortably beating its own target range of 1.0-2.0 billion euros, Bank of Spain figures showed.

The U.S. Federal Reserve on Thursday signed off on proposed new regulations to bring U.S. banks in line with the Basel III global standards, aimed at giving banks more crisis-resistant footings.

The U.S. rules will give bank holding companies and savings and loans companies with at least $500 million in assets until 2019 to meet the new capital rules, which have met resistance from banks as too hefty.

A group of Chinese and Japanese investors have submitted an offer to take over bankrupt Swedish carmaker Saab, a spokesman said Thursday.

"We submitted a definitive offer on April 7" before the deadline for bids expired, said Mikaael Oestlund of the National Electric Vehicle Sweden AB (NEVS).

Global markets rose on Thursday, boosted by hopes that Europe is preparing to give Spain financial aid to help it cope with the cost of saving its banks and that the Federal Reserve will consider additional support for the U.S. economy.

Spain's government cannot afford to rescue its banking sector but is reluctant to accept a full-fledged bailout from its eurozone partners, as that would mean giving up control over some of its domestic policies.

Organizers of Tokyo's bid to host the 2020 Olympics said Thursday bringing the games to the Japanese capital would generate economic activity worth $37.9 billion and create more than 152,000 jobs.

The $37.9 billion figure includes a $21.1 billion economic benefit for the Tokyo metropolitan area and 16.3 billion for the rest of the national economy.