Morning in brief: Spain and Italy could spark recession, US equity markets fall

Spain and Italy are predicted to drag Europe into recession, both the Dow Jones and S&P 500 continue to fall and Facebook has acquired photo-sharing app Instagram for $1 billion.

Foreign-exchange forecasters have told Bloomberg that the euro is expected to drop 5% to $1.24 by the end of 2012. Spending cuts from Spain and Italy are predicted to “reignite debt turmoil and drag the region into recession.”

US equity markets extended losses to a fourth day yesterday following U.S. non-farm payrolls data which failed to meet expectations, reports Reuters. Both the Dow Jones and the S&P 500 continue to fall as concerns over the stability of a recovery in the US rise.

Facebook announced that it will acquire photo-sharing app Instagram for an astonishing $1 billion (£629m), reports the BBC. Instagram was launched less than two years ago and claims to have 30m user per day.