ESMA Warns Weakening Economy and High Valuations Could Trigger Abrupt Market Correction

ESMA warned that a gap between weakening economic conditions and high valuations could trigger an abrupt market correction. According to NS3.AI, the watchdog cited conflict in the Middle East and rising energy prices as factors adding to market risk. ESMA said operational risks across financial markets were at a very high and rising level. It also warned about spillovers from crypto markets and risks in prediction markets.