Stock market crash risk is developing, warns Centre for Economics and Business Research

Veteran forecaster Douglas McWilliams said: "signals seem to be building for a kind of crash of the market - shares and many links are already down significantly from their recent." Earlier this year, we gave one in five ratings on a UK relapse. Now, the chances are about one in three. »

The FTSE fell sharply from a peak of more than 6,000 in early July; whereas the Greek and Italian bond prices fell from a cliff, as investors prepare for a possible defect.

Angus Campbell, Director of sales in Paris to the spread of the company Capital spreads, said: "Sentiment is quite beat;" indices of continue to chop and change between the ups and downs. "It is impossible to make a rational decision on where to invest your money when these huge macro issues dominate the proceedings."

Mr. McWilliams criticizing the US and European politicians for the treatment of their deficits as a policy of bargaining chips. It is few options left open to them to avoid an accident, he said. "The real fear is that major economic weapons have been used to treat the last crisis." "He has no scope to reduce interest rates and printing money is regarded with skepticism, but it may be the only option."

Analysts fear a global crisis if there is any form of positive result of emergency European Summit on Thursday. Mick Gilligan, partner Killik & Co, said: "if it is not an any positive result out of Europe, it could be any of a rough summer." If politicians have disappeared from the break, the markets will wait. »

Deutsche Bank analysts, said last week that global stocks may plunge as much as 35pc if the crisis in a spiral.

Falls may be exacerbated by low trading during the summer and even the Test Match on Thursday, said Mr. McWilliams. "There is a history of crises from August as the financial crisis of 2007 and the default of 1998, not to mention the August crisis more Russian famous which became the first world war."

He joined a growing chorus of voices for a relapse. A recent Deloitte survey showed that one in three Directors finance of FTSE 100 and FTSE 250 companies estimated that the British economy will fall back into recession.

Mr. McWilliams finished by taking a potshot at David Cameron. He said that the Prime Minister could take advantage of the crisis to renegotiate links of the United Kingdom with Europe, which could bring down the Coalition and an early election of the force. "Much could happen in the coming weeks," he concludes.

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