(ANSA) - Rome, July 20 - Markets were in turmoil hours before closing and borrowing costs in Italy and Spain rose as eurozone finance ministers approved a rescue package to shore up struggling Spanish banks on Friday. The Milan stock exchange fell amid fears of contagion, with the Ftse Mib index losing 3.7% by 15:25 local time. The Madrid bourse also lost around 3%. The yield spread between Italian 10-year bonds and their German benchmark equivalent, a key indicator of the country's ability to weather the economic crisis, reached 500 points on Friday afternoon. The spread between Spanish bonds and the German bund reached 601 points, a new record high. The yield on 10-year Italian bonds rose to 6.16%, while that on the Spanish equivalent exceeded the critical level of 7% to reach 7.17%.