The euro and the pound remained under pressure yesterday, edging lower against the dollar as concerns over government debt in Europe continued into a new week, but share prices on most European markets stabilised after last week’s losses.

The 16-nation currency bought $1.3629, slightly below the $1.3634 it fetched in New York late on Friday. However, it did not repeat Friday’s temporary slide below $1.36.

Sterling tumbled to an eight-and-a-half-month low against the dollar as the pound bore the brunt of risk-aversion selling.

Worries about how eurozone states including Greece and Portugal will service their debts have prompted investors to cut their exposure to risky assets, including those denominated in sterling, which has been battered in recent weeks.

Taking losses into a fourth successive day, the pound fell to $1.5535 in early London trading, its weakest since late May 2009, before recovering to around $1.5641. Analysts said sterling may come under more selling pressure as broad concerns about sovereign debt highlight Britain’s own grim fiscal position and crank up risk aversion.

The euro has been suffering amid persistent concern that debt loads in Portugal, Spain and particularly Greece could hinder or derail the eurozone economic recovery.

Meanwhile, gains in the mining sector helped the London stock market pull out of a losing streak but economic worries continued to shake confidence in financial stocks.

The FTSE-100 index finished the day up 31.4 points at 5,092.3, after suffering steep falls in the session, dropping to just 33 points above the psychologically important 5,000 level at one point. Most banks and insurance stocks finished lower.

Shares in Frankfurt and Paris also finished in the black but analysts said investors remained worried about European debt.

Earlier in Asia, Japan’s benchmark Nikkei 225 closed at a nearly two-month low, falling 1.1%, or 105.27, to 9,951.82.