NEW YORK ( TheStreet) -- Fitch Ratings downgraded the debt of Spain and Italy on Friday, adding to the flurry of sovereign debt ratings cuts in Europe in recent days as concerns about the crisis intensify. The ratings agency downgraded Spain's long-term credit rating to AA- from AA+. It also cut Italy's long-term credit rating to AA- from A+. The outlook for both countries is negative. Fitch said the downgrade to Spanish debt reflected "the intensification of the euro area crisis" and "risks to the fiscal consolidation effort" arising from the budgetary performance of some regions. "As Fitch has previously cautioned, a credible and comprehensive solution to the crisis is politically and technically complex and will take time to put in place and to earn the trust of investors. In the meantime, the crisis has adversely impacted financial stability and growth prospects across the region," it said in a statement. "However, the still sizeable structural budget deficit, high level of net (although not gross) external debt and the fragility of the economic recovery as the process of deleveraging and rebalancing continues render Spain especially vulnerable to such an external shock." However, the ratings agency said Spain's sovereign solvency remains secure. "Spain's 'AA-' rating reflects strong fundamentals: a diversified, high-value-added economy and strong governance. The government's policy response has been credible and aggressive." Fitch's downgrade of Italian debt also citing he intensification of the crisis. The move closely follows a similar action from Moody's ( MCO) earlier this week. Moody's downgraded Italian debt by three notches on Tuesday. Stocks retreated following news of the downgrade. The Dow Jones Industrial Average was down 0.4%, while the Nasdaq and S&P 500 were losing more than 1% each. Bank stocks extended earlier weakness, with the stocks of Bank of America ( BAC) and Citigroup ( C) shedding more than 5% each. JPMorgan Chase ( JPM) saw its shares slide more than 4%. Shares of Morgan Stanley ( MS), which has been under attack over concerns about its exposure to the region, was tumbling more than 6% to $14.25. --Written by Shanthi Bharatwaj in New York >To contact the writer of this article, click here: Shanthi Bharatwaj.