Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
The financial markets are a sea of red this morning, as the biggest selloff since Donald Trump won the US presidency gathers pace.
Investors are increasingly spooked that global interest rates are heading higher, bringing the long era of loose monetary policy and easy money to a close.
On Friday, Wall Street suffered its biggest decline since the Brexit vote. The Dow tumbled by 2,5%, or almost 666 points in a nervy selloff (the biggest points fall since the collapse of Lehman Brothers.
Europe and Asia are now following suit. Over in Japan, the Nikkei has fallen by 2.5% — it’s biggest fall since the US presidential election in November 2016. There were also losses in South Korea (-1.1%) and Australia (-1.5%).
Greg McKenna, chief market strategist at AxiTrader in Australia, warns:
In London, investors are bracing for the FTSE 100 to shed more than 1% when trading begins at 8am GMT.
FTSE 100 Index called to open -80pts at 7365 pic.twitter.com/pCUfpN8vg2
February 5, 2018
Government bonds are also falling, amid growing concern that America’s central bank will hike borrowing costs more aggressively than expected.
Some analysts think that Fed could raise rates four times this year — the market had previously only priced in three rises.
Traders will also be watching for a new healthcheck on the world’s service sector companies.
9am GMT: Eurozone service sector PMI for December
9.30am GMT: UK service sector PMI for December
9.30am GMT: Sentix survey of eurozone investor confidence
3pm GMT: US service sector PMI for December
4pm GMT: European Central Bank president Mario Draghi speaks at the European Parliament, Strasbourg