“The FTSE 100 is on course for its worst year since the financial crisis as economists warn that investors need to brace for a “Wile E Coyote moment” when the overheating US economy runs off a cliff edge in 2020.

 

Around $3 trillion (£2.3 trillion) was wiped off the value of global stock markets in a week-long rout sparked by fears of surging US borrowing costs. However, the Centre for Economics and Business Research has warned that its model suggests that US stocks are still overvalued by around 30pc even after this week’s sell-off.

 

The FTSE 100 has now tumbled 9pc in 2018 after markets were rocked by expectations of the Federal Reserve maintaining the brisk pace of its interest rate rises in an effort to rein in the booming American economy.”

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