Wild fluctuations in the global stock markets always hit the headlines. Students often ask how these swings impact the underlying economy or the factors that produce the swings in the first place.
This article by the BBC, Turmoil on stock markets persists does a good job at identifying the various factors behind recent falls in global markets. What students should note is that stock markets tend to be a forward-looking indicators in that investors are predicting economic performance in 6 to 12 months time.
