A market correction which started in earnest on Friday 2 February on Wall Street, rounding of the worst week for US stocks in two years, has spread across Asia and into Europe as the new weeks gets underway.
The table below shows how the major global indices have performed since the end of January.
After a strong start to 2018, several factors are intervening to put the brakes on global equities.
Rising government bond yields have raised fears of a rotation into these lower risk assets as their income attractions start to stack up against stocks and shares.
Strong US economic data is driving speculation that interest rates across the pond will increase faster than expected. Rising rates tend to be negative for the performance of shares.
At a sector level, oil stocks have struggled to match increased expectations after a big increase in the oil price. Technology stocks have also been hit by soft smartphone sales and other negative news flow around consumer electronics giant Apple.
Keep a close eye out when the US stock markets commence trading this afternoon. If bargain hunters emerge and stocks recover it might help arrest the slide in global equities, but if selling intensifies we could potentially be in for a much larger correction.
