With the global sell-off continuing to push stocks lower over the past couple weeks, the so-called Donald Trump effect may have reached its climax.

Despite the market optimism that followed the election of decidedly pro-business Trump, the first weeks of February have signaled perhaps an end to record highs of 2017.

Last week, global stocks fell amid concern over adjustments to monetary policy and on the back of strong economic data from the US.

Despite a market rebound in Wall Street and European markets in recent days, Japan’s Nikkei 225 still remains in the red, in light of the strength of the Yen.

Accordingly, the FTSE 100 is currently up 46 points (0.65 percent), Germany’s Dax is up 0.9 percent, and the French Cac has risen 0.5 percent. Similarly, the FTSE MIB in Italy also rebounded 0.7 percent.

“We suspect that investors’ fears over inflation should subside over the coming weeks, which will help to stabilise equity markets, long-term yields and bring levels of volatility back down,” explained Derek Halpenny, analyst at MUFG , in comments to the Financial Times.

“But after the scale of this equity price correction, investors are likely to remain defensive this week. Even a slight upward surprise in the inflation data could be enough to warrant a further sell-off.”

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Ultimately, strong European economic data pushed European stocks on the whole higher on Wednesday morning, driving the slight recovery in the markets.

Specifically, Eurozone industrial production proved better-than-expected, with growth of 0.4 percent in December in comparison to the month higher, demonstrating an annual gain of 5.2 percent. Analysts had been expecting growth of 0.2 percent and 4.2 percent.

Moreover, Eurostat, the EU statistics office, said that eurozone GDP grew by 2.5 percent during 2017, marking its fastest growth rate since 2007.

However, UK economic data continued to disappoint with the slowest GDP growth across the G7 countries, behind Italy.

Nevertheless, given the focus upon inflation, markets will be bracing themselves for the scheduled release of US consumer price data, which is set to be revealed tomorrow.

It remains to be see whether the stock market rally during the latter half of 2017 and so-called ‘Trump effect’ will continue as a trend in the new year.