Financial markets in Asia and Europe are affected by a number of important events this week. The greatest nervousness seems to be caused by the upcoming meeting of the three major global central banks.
Hang Seng, Asia Dow and Nikkei are in the red
Monday’s biggest ever drop was recorded by the Hong Kong Stock Exchange’s Hang Seng index, which wrote off more than two percent. This was followed by the Asia Dow, which lost over one percent of its value. The main index of the Shanghai Stock Exchange (-0.87 percent) and the Tokyo Nikkei index (-0.21 percent) were also in the red.
Europe’s largest stock markets also declined
However, stock markets in Europe also had a nervous start to the new trading week. London, Frankfurt, Paris and Madrid recorded similarly deep declines of between 0.3 and 0.4 per cent. The bad mood on the markets can be attributed to the upcoming meetings of the US Fed, the European Central Bank and the Bank of England.
Experts and markets expect all of these central banks to raise their base interest rates by half a percentage point. Although such an increase is quite likely, the line across the budget may yet be drawn by US inflation data. If it were to rise unexpectedly, the chances that the Fed would raise rates as sharply as in the four previous cases would increase. And that would be bad news for the stock markets.
