Global markets see continued volatility

After US stock markets fell around 4 per cent for a second day this week, global markets continued to experience increased volatility and finished another day down from record highs today. European markets were down between 1 and 2 per cent at the close of trading, with the US falling a little further into negative territory shortly after the open before regaining some losses from the previous day. This week's fall is believed by many to be a correction from valuations becoming too high, too quickly and was seemingly triggered by a string of stronger than expected economic data coming from the US. This in turn has heightened inflation expectations and caused central banks to adopt a more hawkish tone on the pace and extent of coming interest rate hikes. Whilst further volatility is expected, global growth remains robust and the fundamental outlook for the global economy is positive.