European stock markets advanced on Tuesday amid Britain’s biggest nationwide rail strike for 30 years.
It comes in the midst of an ongoing dispute over pay, jobs and conditions for rail workers. So far there has been 18 months of negotiations between Network Rail and the RMT union.
Tens of thousands of staff walked out today, paving the way for widespread industrial action across the economy in coming months. The majority of lines on the London Underground were also largely closed due to a separate strike.
The Centre for Economics and Business Research have warned that the three strikes taking place today, on Thursday and on Saturday will have a fallout worth at least £91m to the UK economy.
Richard Burge, chief executive of the London Chamber of Commerce and Industry, said: “While this strike will be damaging, a recession is looking likely regardless; as such, I wouldn't pin an eventual recession on this strike.
"However, what is very worrying is the possibility that this dispute continues through the year and we see multiple strikes into the future.”
Meanwhile, transport secretary Grant Shapps told Sky News: "We are going to take steps to make sure this kind of thing is less damaging in future."
Watch: Train stations deserted as Britons hit by major travel disruption due to rail and Tube strikes
Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown, added: "The rail strike risks turning ongoing operational headaches into a fully blown migraine for the hospitality industry.
"Restaurants, bars and hotels were already struggling under the strain of sky-high energy prices, supply chain disruption and the ongoing labour crunch, and now the mass walkouts are set to cause fresh financial pain.
"As the transport network seizes up, bookings are expected to plummet as the lucrative lunchtime crowd stay at home, and night-time revellers cancel reservations whilst fearful they won’t be able to get home at the end of the night."
Many pubs, venues and restaurants are shutting up shop early this week because staff are unable to get into work.
Workers were already feeling overstretched with the accommodation and food services industry reporting the largest number of businesses experiencing labour shortages, with 35% firms saying it was a problem in mid-June.
It came as US growth slowed sharply last month, according to a closely watched survey from the Chicago Federal Reserve.
The Chicago Fed’s national activity index weakened to 0.01 in May, down from 0.40 in April. This suggests economic growth declined in May, with only a marginal expansion.
Last night, economists at Goldman Sachs (GS) cut their US growth forecasts and warned that the risk of recession is rising.
The Goldman team now sees a 30% probability of America entering a recession over the next year, up from 15% previously.
US markets were closed on Monday for a public holiday, however, an increasingly hawkish tone from Federal Reserve officials appears to be prompting concerns about global growth.
This is after Fed governor Christopher Waller emphasised a determination on the part of the US central bank to get inflation down in a tone that suggested they would risk a recession to do so.
The general sense of despondency has rattled US markets in the year to date, with the Dow Jones having fallen 18%, the S&P 500 23% down, and the Nasdaq 30% lower.
Stocks in Asia were mixed overnight, with the current fears of a significant slowdown being partially offset by hopes that the Chinese authorities are prepared to offer some monetary assistance.
Watch: How does inflation affect interest rates?