Investors were nervous about Europe’s debt logjam heading into the weekend as exchange traded funds that track Italy and Spain fell by 3% in U.S. trading Friday.

Italian banks plunged Friday following a warning from Moody’s that it may downgrade the lenders’ credit ratings. Shares of UniCredit and Intesa Sanpaolo, the largest banks in Italy, suffered declines of nearly 10%.

Earlier this month, Moody’s put Italy’s local and foreign currency government bond ratings on review for possible downgrade.

Also Friday, iShares MSCI Spain (NYSEArca: EWP) traded lower after the government approved a nearly 4% cut in spending for 2012.

Although Greece has dominated the headlines on Europe’s debt crisis this week, other countries at risk include Spain, Italy, Portugal and Ireland. They are facing austerity measures to shore up their finances.