Spanish stocks soar - as investors showed their relief at a bailout of up to 100 billion euros for the country's indebted banking sector.

Spain's IBEX has so far been the worst performing European index in 2012 but rose 4% on Monday morning.

And financial stocks proved especially popular with investors.

Shares in struggling lender Bankia initially rose 15% while BBVA was up around 6% and Banco Santander climbed by 4.5%.

Analyst Miguel Murado says the bailout may please investors, but it doesn't solve all Spain's problems.

SOUNDBITE: ECONOMIC ANALYST MIGUEL MURADO, SAYING (English):

"I think events now have become the driving force in this crisis. No longer rationality or the reckoning of the actual state of accounts for the different countries, but actually events that are driving the markets in one direction or another and, yes, we still have to see, we are not out of the woods at all."

The bailout also found favour in Asia - as shares there closed up.

And the euro bounced on Monday morning, while Spain and Italy's borrowing costs fell.

But many traders fear the market relief will be short-lived.

SOUNDBITE: TRADER WITH BAADER BANK, ROBERT HALVER, SAYING (English):

"Considering banks, 100 billion euros is enough but the main problem is Spain. Spain is not able to do reforms and that's why Spain will need even more money the next couple of maybe months."

The Spanish bailout will undoubtedly buy Europe some more time as it continues along the road to greater integration.

But analysts warn the markets are becoming addicted to bailouts - the effects of which are only predicted to last a few days.

Joanna Partridge, Reuters