The return of risk

Markets have been hugely volatile over the last few weeks. A mere correction, say some. A buying opportunity, say others. But could we be witnessing the first signs of something more serious? asks Merryn Somerset Webb.

Markets have been hugely volatile over the past few weeks. But no one seems worried. A mere correction, say some. A buying opportunity, say others. Is that true? Or does it presage something more serious? Probably the latter, says Merryn Somerset Webb

The last few weeks have been tricky for global markets. The details will be familiar by now: on 27 February, the Chinese market fell 9%, other Asian markets tanked in sympathy, the European markets followed, and then, when the US opened, the Dow promptly fell 416 points in a day its biggest one-day drop since the markets reopened after September 11th 2001. The rest of the week was little better, with global markets ending 5% down on average, and even this week didn't get off to much of a start: the Dow and FTSE were unusually volatile on Monday. However, by Tuesday things had stabilised US and European markets both ended the day up strongly and by mid-week the panic seemed to be over.

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