Global equities decline as worries of a recession grow

Global equities decline as worries of a recession grow

Global equities decline as worries of a recession grow
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  • The FTSE All World index of developed and emerging market equities lost 0.3% on Friday afternoon in London.
  •  Europe’s regional Stoxx 600 fell 0.5% after data on eurozone consumer prices that exceeded estimates strengthened hopes that the European Central Bank would hike interest rates.
  • US stocks, which set the tone for global trading, have not undergone such a brutal first half of a year since 1970.
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As investors struggled to see the end of inflation and interest rate pressures that drove Wall Street to its worst first-half decline since 1970, global equities began the second half of the year on a sluggish note.

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The FTSE All World index of developed and emerging market equities lost 0.3% on Friday afternoon in London, increasing its year-to-date losses to just over 20%.

Europe’s regional Stoxx 600 fell 0.5% after data on eurozone consumer prices that exceeded estimates strengthened hopes that the European Central Bank would hike interest rates, supporting banking stocks. Since the end of 2021, the regional share index has declined almost 16%.

Futures trading also suggested that Wall Street’s S&P 500, which fell by one-fifth in the first half of the year, would drop another 0.2% on Friday.

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In recent months, investors have fled riskier assets in response to a jump in global inflation caused by delays in supply chains caused by the coronavirus epidemic. This has been compounded by Russia’s invasion of Ukraine, which has prompted global central banks to abandon monetary policies that promoted economic development and borrowing.

The annual rate of inflation in the eurozone rose to 8.6 percent last month, up from 8.1 percent in May, according to data released on Friday.

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