Major indices in the US dipped yesterday in the wake of indications that more interest rate rises could be on the cards.
A potential shutdown in government, as well as variable earnings results ahead of Christmas has also weighed on investors’ minds.
Major indices stateside are now at their lowest level in around 15 months after the Dow Jones industrial average closed 2 per cent lower, the S&P 500 dropped 1.6 per cent and the tech giant-driven Nasdaq slumped 1.6 per cent.
The Nasdaq is now nearly 20 per cent down from its record close on August 29.
In the UK, the FTSE also closed down just under 1 per cent.
While the Bank of England held its base interest rate at 0.75 per cent, the Federal Reserve in the US confirmed another rate increase on Wednesday, and hinted that there could be more to come in 2019, even if their pace was slower.
While markets are still arguably at elevated levels, investors are noting increased volatility, particularly politically, as Brexit negotiations continue in the UK, and US president Donald Trumps suggests he may be willing to threaten a government shutdown to encourage Congress to release funding for a border wall with Mexico.