A financial market rout

<p>Kia ora,</p><p>Welcome to Tuesday's Economy Watch where we follow the economic events and trends that affect New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news the international week has started with a financial market rout as the bears come out to play.</p><p>There has been a dramatic risk-off mood sweeping over markets today with commodity prices slumping, equity markets falling sharply, benchmark bond yields diving, and the US dollar streaking higher. The rise and rise of the pandemic delta variant now has investor attention, more so because of the clear response mistakes by both policy makers (in the UK and Eastern Europe especially) and an increasing brainless response by a sizable population in some heartland US states. Investors can see these mistakes are not going to end well.</p><p>Yesterday, the UK, which is pushing toward a full economic and social re-opening, <a href="https://coronavirus.data.gov.uk/" target="_blank"><strong>recorded</strong></a> +40,000 new pandemic cases, its highest since the January spike that hit +68,000 before falling away in May to +2,000. Indonesia reported +44,000. India +38,000. Brazil and Russia also reported fast rising trends. The fear of spread from these uncontrolled hotspots is that it will reverse the <a href="https://financialpost.com/news/economy/canada-to-reopen-border-to-fully-vaccinated-u-s-tourists-from-august-9" target="_blank"><strong>re-opening plans</strong></a> everywhere.</p><p>In France there was an interesting pandemic development where they switched from 'encouragement' to 'threats' to improve their vaccination rate. France, a hotbed of vaccination conspiracy theories, said it would end free tests for those who want to travel or attend events. The effect was dramatic, with 926,000 people making a vaccine appointment.</p><p>Adding to unease, the United States <a href="https://www.state.gov/responding-to-the-prcs-destabilizing-and-irresponsible-behavior-in-cyberspace/" target="_