After days of slipping, and erasing some $3 trillion in value, the world's markets are witnessing a bounce. While some analysts have said this rally will continue for a little while, others have said this is more like the calm before the storm.
World stocks fought their way back into positive territory for the first time after the U.K. voted to leave the European Union (EU) last week, sending markets sliding into a sea of red. Currency volatility was seen at its highest with dramatic moves in sterling from $1.50 to a 31-year low of $1.32. While it continues to remain under pressure, sterling has clawed its way back into positive territory, trading more than 1 percent percent higher above $1.33.
Joe Rundle, head of trading at ETX Capital called this rally a dead cat bounce - a temporary recovery in prices as speculators try to cover their trades - in his latest research note.
"Sterling has rallied a little overnight but the margin is small compared to the 10 percent fall in cable since Friday. The FTSE 100 has also opened higher today but the mood is fragile and as fund managers start to flex their muscles there could be a long way to fall. This looks like a classic dead cat bounce."