Mr Cameron travelled to Brussels for the two-day economic summit, declaring: "My agenda is to get Europe working."
Portuguese sovereign bond yields soared to new highs in the wake of the country's parliamentary rejection of its latest austerity package. Jose Socrates, prime minister, was forced out on Wednesday night after failing to win support for the measures.
Fears for the eurozone rose as Fitch downgraded the country's credit rating from AA to AA-, while Moody's cut the credit ratings of 30 Spanish banks.
In Britain, Mark Hoban down played Britain's exposure to the crisis. He told Parliament that the UK will "play no part in a proposed permanent European bail-out fund because it is not in the eurozone". He added that bilateral trade with Portugal was just £4bn in 2010.
Kevin Dunning, economist at the Economist Intelligence Unit, said: "The resignation of the Portuguese Prime Minister adds a political crisis to a fiscal crisis, and brings a bailout a step closer."
RBS analysts said an emergency bailout was likely to trigger a fall in Portugal's credit rating and its bond yields to converge to Irish levels.
The European summit was arranged to agree various policies in the event of a future crisis over the euro, including a bailout mechanisms. However, officials warned that the volatile events in Portugal would hamper any firm resolutions.
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