“The rush for the exits continues across stock markets, as investors renew their selling of equities. marking one of the most dramatic starts to the year that we have seen since 2018”.

Rush for the exits turns into a stampede

“It has been a brutal start to the week for stocks, pushing the Dow below 34,000 and the Dax below 15,000. There had been some hope that the new week might see a more optimistic view prevail, but the catalogue of earnings this week, along with a key Fed meeting, have combined to keep investors firmly in risk-off move. In addition, investors will have spent the weekend reading of troop build-ups around Ukraine and the growing tensions between Russia and the West, providing yet another reason to either sell stocks or sit on the side-lines.”

Sudden rebound unlikely

“While many investors will be hoping that a rebound can develop quickly, the longer this pullback goes on, the more damage is done to sentiment. And with selling accelerating to the downside it becomes hard to stop the train in short order. What we can expect this week is more volatility, and until the FOMC meeting is out of the way, and the Fed’s current stance becomes clearer, it seems likely that more losses are in store.”

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

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