The FTSE 100 has continued to sell off in early trading on Monday following further falls in Asia, as investors continue to dump stocks on fears QE will be withdrawn in the US.
The FTSE 100 has halted its two-day slide as investors buy back into equities following yesterday's sharp sell-off, with Lloyds and other financials leading the pack.
The FTSE 100 has slumped 3%, gold has dropped 5% and gilt yields have spiked to their highest level in over a year as the prospect of an end to US QE rattles markets.
US markets followed shares across Europe higher overnight, while the dollar also surged, ahead of the latest Federal Reserve meeting in the States which may map out a QE exit strategy.
Equity income stocks could be among the biggest losers from an environment in which investors prepare for a tapering of US QE, investors have warned.
Sharp share price falls from a number of financials have sent the FTSE 100 lower today, with the index approaching a four-month low.
A lack of further easing from the Japanese authorities coupled with fears over QE in Europe rattled markets today, sending the FTSE 100 to a seven-week low, with asset managers some of the biggest fallers.
Wall Street extended losses on Wednesday as fears deepened that the Federal Reserve will pull back its quantitative easing programme.