That move will make bonds more attractive at the expense of equities, while a slump in the world’s second-largest economy due to the ongoing Covid crisis will weigh on demand for goods and services. service.

Beijing could soon return to lockdown, sending Chinese stocks back to lows not seen since before the pandemic.

Germany could fall into recession if there is a Russian energy embargo. “Last week we had German officials saying that if there was an immediate Russian energy embargo it would cause a recession in Germany,” said Rabobank strategist Jane Foley. And if there is a recession in Germany, that will drag the rest of Europe down and affect the rest of the world. “

Oil prices fell more than 4% to $101.9, a slight drop in itself, but a sign of today’s turmoil.

The FTSE 100 lost 150 points to the 7372 – the biggest losers were mining giants like Glencore and Rio Tinto. BP and Shell both fell more than 4%.

In France, the CAC 40 index opened 2% lower, despite signs of softening ahead of Emmanuel Macron’s victory in the French presidential election. Other European markets followed.

China’s CSI 300 index fell nearly 5%, while Hong Kong’s Hang Seng index lost 3.9%.

The British pound fell sharply on Friday, to a two-year low after bad retail sales figures. It continues to play out today, at least against the dollar, losing 0.96 cents to $1.2741.

The US Federal Reserve is now expected to raise interest rates sharply in an effort to combat inflation.

Candace Browning, head of global research at Bank of America, said: “Fears over exchange rates and recession are currently the biggest risks for investors. Food and gasoline prices are up. High levels plus the end of key stimulus programs have investors concerned about the ability of low-income consumers to spend.”

The Office for National Statistics has revealed a new survey into the cost of living crisis, with nine out of 10 adults saying they have noticed an increase in prices. More than four in ten say they won’t be able to save money in the next 12 months.

AJ Bell chief investment officer Russ Mould said: “Markets depreciated severely on Monday following the massive sell-off in Asia amid fears of Covid lockdown in Beijing.” speak.

The prospect of further restrictions in China could lead to a toxic combination of further inflationary pressures, as supply chains in the so-called ‘factory of the world’ are disrupted and growth weaker economy.

“The likely outcome is stagnant inflation – a slowing economy accompanied by rising prices – some investors should be pleased with.”

Walid Koudmani at financial brokerage XTB speak:

“The market mood has deteriorated as the Covid situation in China has not improved and the media is hinting that Beijing could be the next option for the shutdown after Shanghai and some cities. other big.”

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