The sell-off in global stocks that briefly looked to have ended mid-week has come back, with European stocks heading for a five-month low after markets from the US to Asia tipped into declines exceeding 10 per cent from their January highs.
The Stoxx Europe 600 Index was set to post its worst week in two years, with all industry sectors in the red Friday. Japanese and South Korean indices earlier closed down about 2 per cent and Hong Kong’s slid about 3 per cent. China, where retail investors dominate, got hit particularly hard, with onshore gauges at one point exceeding 5 per cent losses on the day. US futures climbed, even as the US government entered a partial shutdown, and Treasuries yields rose.
Meanwhile, the dollar weakened against the euro and the pound, and strengthened against the yen. China set the yuan lower Friday after it weakened the most since 2015 yesterday.
Equity traders have yet to get comfortable with a jump up in benchmark US 10-year yields to the highest in four years, and worries over unwinding bets against volatility in stocks continue to cast a shadow over markets. The negative superlatives have piled up quickly: the S&P 500 has erased its gain for the year, closed at a two-month low and is on track for its worst week since 2011. The Dow plunged more than 1,000 points for the second time in four days. The MSCI Asia Pacific Index is set for the worst week since at least February 2016.
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Saxo Bank equity expert says too early to predict bear market
Dow Jones plunges 4.6%, wiping gains of 2018 so far
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Pressure on US stocks again came from the Treasury market, where another weak auction put gave bond bears ammunition, sending the 10-year yield as high as 2.88 per cent. Equity investors took the signal to mean interest rates will push higher, denting earnings and consumer-spending power. Over US$5 trillion has been wiped from global stock markets since Jan. 26, according to S&P Dow Jones Indices.
“There’s some big-money players that have really leveraged to the low rates forever, and they have to unwind those trades,” said Doug Cote, chief market strategist at Voya Investment Management. “They could be in full panic mode right now.”
Elsewhere, oil headed toward its worst week in almost a year as the global risk-asset rout further rankled investors already concerned over growing US supply. Gold steadied and industrial metals declined.
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
The low down
Producers: Uniglobe Entertainment & Vision Films
Director: Namrata Singh Gujral
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Skewed figures
In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.
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Cast: Ayushmann Khurrana, Tabu, Radhika Apte, Anil Dhawan
Rating: 3.5/5
FIXTURES
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![Numbers showing the negative change of the German DAX share price sit on a display screen inside the Frankfurt Stock Exchange. European stocks are set to report their worst performance in two years. [Photographer: Alex Kraus/Bloomberg]](https://thenationalnews.com/resizer/v2/PQCE37IFUPWQYTE74H5DJEX74Q.jpg?smart=true&auth=086f779363995354526839448be9a74dfd8cb114abcf19773d9f0044ab879a99&width=800&height=450)