Once again, the rise in government bond yields is acting as the catalyst for the sell off in stocks.
European stock markets closed largely flat amid low volatility. The major indices were in positive territory for much of the session but dipped just before the session ended.
It has been a choppy 24 hours in the markets as the Fed Reserve carried out a dovish hike yesterday, and today’s GDP report suggests the country is now in a recession.
Stock markets are pushing higher ahead of the Federal Reserve meeting, even though it is widely believed the bank will reveal a large interest rate hike.
Stock markets in Europe mostly finished in the red due to worries about an energy shortage.
Equity markets are experiencing low volatility today as traders look ahead to the Federal Reserve’s meeting on Wednesday, interest rate futures are factoring in a high probability of a 75-basis points hike.
The euro continues to see high levels of volatility more than 24 hours after the European Central Bank hiked interest rates by 50 basis points.
The European Central Bank caught some by surprise as it lifted interest rates by 0.5% as the bank previously hinted about a 0.25% lift.
The IMF lowered its growth forecast for the global economy from 2% to 1.2%, in addition to that it also downgraded next year’s outlook to 0.8% from 2.1%.
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