Markets have calmed down slightly after a dramatic start to the new trading week- Stock Market Today: Calmer markets but dark clouds remain.
European equities are trading slightly higher this morning with the German index up 0.60 per cent on the day.
Nevertheless, there are some dark clouds on the stock market horizon and market sentiment has turned sour.
Ahead of the US presidential election, risk appetite is low and there are less investors willing to buy the dip during a sell-off.
Meanwhile, in Europe, the fear of further restrictions on everyday life is on the rise.
Governments across the continent are trying to prevent another complete lockdown.
However, even a partial lockdown could inflict significant damage to the EU economy and potentially trigger a double-dip recession.
Therefore, investors remain hopeful that central banks and governments will soon take substantial stimulus measures to limit the economic damage.
In recent months, the stock market rally has been driven by easy monetary policy, fiscal stimulus measures and positive developments in the fight against the COVID-19 pandemic.
Removing one of those pillars could leave markets on shaky ground.
Stock Market Today: Calmer markets but dark clouds remain