A healthy correction may not be the end result of the global market rout

Markets began February with a heavy thud as US equities fell by 10 per cent from their January high, sending other equity markets cascading around the world.

However it was not long before the sell-off appeared to settle down, which seemed to bear out those analysts who considered the drop to be no more than ‘healthy correction’. In fact the number of Bloomberg stories mentioning ‘healthy correction’ hit a record high during last week. Time will tell whether this turns out to be accurate, but it is worth remembering that consensus assumptions rarely are.

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