New year - same old issues. Equity markets had a tricky last few months of 2015, worried about growth in China and emerging markets and about its impact on the global economy. 2016 has started in the same vein, with a big overnight drop in Chinese shares sparking significant enough losses in European markets, and a follow on decline in the US.

The Chinese sell-off was, ostensibly, sparked by a weak reading for a manufacturing index - the Caixin factory index – which came in at 48.2, a bit below expectations. This followed official data issued on New Year’s day also indicating manufacturing weakness. There was nothing particularly remarkable about today’s data, indicating just how on edge markets are in China, and elsewhere in emerging markets, which were also hit in the fall out. It is a story which started back last August, when China allowed the yuan to devalue, highlighting its own growth fears and threatening pressure on countries with which it trades.

The poor reaction in Europe shows continued growth fears in the euro zone, despite some slightly better economic signals , including manufacturing PMIs out today. German shares - among them big manufacturing suppliers exposed to China – lost more than 4.4 per cent and London lost 2.6 per cent, led by the big commodity and resource companies which have had a fierce hammering in recent months. The mood in London was not helped by its latest UK PMI, which was a bit weaker than anticipated.

In a nasty start for investors to the New Year, US shares are also on the slide. In today’s PMI index lottery, the US was one of the losers, indicating weakness in manufacturing, adding to fears about the impact of global growth.

Dublin shares are trading down around 1.5 per cent. The economic signals here remain much stronger than the international average, with the Irish PMI showing manufacturing expansion, with a reading of 54.2, the highest in five months. Still, Irish shares cannot escape the international fall-out and it remains to be seen how any further weakening of global growth would affect us.

One silver-lining is that the share turmoil and Middle East uncertainties send some money into Government bond markets this morning. Irish ten year interest rates are now around 1.1 per cent. With these kind of rates on offer, it surely will not be long before the NTMA enters the market to undertake its first borrowing for 2016.