In mid-morning trade the week has started off with heavy losses for UK shares.
A couple of hours after the open, the FTSE 100 is down by around 100 points as traders start the week hit by a stream of negative news.
The weekend Spanish election has resulted in a new government, but some are unsure as to whether this new leadership will have an aggressive enough approach to prevent the country needing a bailout.
News that the US has hit a stalemate on agreeing budget cuts is reminding traders of the last time lawmakers reached an impasse in the summer, and the subsequent market fallout that ensued.
Added to this, weekend reports of the Chinese government expecting a long drawn out global slowdown is another reason for investors to stay away from the buy buttons this morning.
Miners and banks are leading the financial spread betting markets lower so far today, with the FTSE 100 back at levels last seen in early October.
With all of today’s catalysts for weakness unlikely to be turned around in the short term, this morning may well be setting the tone for the week ahead.
In overnight trading, US markets have not surprisingly headed lower, and the Dow Jones is now expected to start around 150 points off Friday’s close.
With only housing data on the economic calendar today for the US, these global themes are going to continue dominating sentiment for the rest of today at least.
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Financial Market Comments from Yusuf Heusen, Sales Trader, IG Index.
The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.
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