Global markets plummet sharply, Milan worst in Europe

Global stock markets have suffered a sharp plunge, with a global flight from risk driving up German government bonds considered a safe haven. Recovering oil prices and concerns over the technology sector and debt have triggered the storm in financial markets.

Piazza Affari was the worst performer in Europe, closing the week with a 2.6% drop. The major stock market slump was the dominant theme on the front pages of Italy's main financial newspapers, which highlighted the highly tense trading environment.

Global financial markets have long been under pressure due to a combination of factors. The war in Ukraine, which began in February 2022, triggered an energy crisis that caused wholesale gas prices to triple, exceeding 90 euros per megawatt-hour. This fueled inflation and forced central banks to raise interest rates to contain it.

The increased cost of money has made debt more burdensome for states and companies, while economic growth prospects have dimmed. The technology sector, which had driven the markets in previous years, is particularly sensitive to higher interest rates. The situation erupted in October 2026 when these factors combined, triggering a massive sell-off of stocks and a rush toward investments considered safer, such as German Bunds, whose prices rose.