Tommy Wilkes offers a glimpse at what the markets will look like in the future.

Global stock markets are expected to end the week with a lower close, barring a sudden rebound. For European stocks this is the fourth weekly decline in four weeks. Investors worry about how fast central banks will address inflation.

While yields on government bonds have been rising throughout March and April but stocks are ignoring tightening concerns and have been climbing rapidly

This week’s Federal Reserve minutes showed that investors were rattled by 50-basis point increases and $95 billion in monthly balance sheet shrinkage.

Following their minutes, the European Central Bank took a much more assertive tone than they had expected.

Although this week’s increase in the yields of government bonds — up over 20 basis points on 10-year U.S. Treasuries — was a punchy sign that prices are moving in a dramatic direction, it is still in line.

Stocks fell as investors focused their attention on the possibility that central banks would hike aggressively in order to control inflation as global confidence is being shaken by the conflict in Ukraine. The signs of a possible recession are becoming increasingly evident in both the Euro zone and the United States.

There was some relief overnight with Wall Street’s late recovery and European markets opening slightly higher.

This week’s other major story in markets across the euro area is Sunday’s first-round French election. In this round, incumbent President Emmanuel Macron seems set to fight for his life.

Nerves are increasing due to the tight French Presidential race, which has caused a selloff of French government bonds this week.

This week has seen little corporate news and earnings.

Graphic: FED AND STOCKS- https://fingfx.thomsonreuters.com/gfx/mkt/xmpjoqxkavr/Pasted%20image%201649296859647.png

Markets should be more informed by Friday’s key developments

Shanghai increases COVID testing while other Chinese cities put curbs

Japan’s February Current Account swings to surplus, after years of big deficit

German Chancellor Olaf Scholz goes to London to meet British Prime Minster Boris Johnson

Review of Financial Stability by the Reserve Bank of Australia

Russian Q4 GDP

– ECB’s Executive Board Fabio Panetta; Bank of Spain’s governor Pablo Hernández de Cos; board member Isabel Schnabel