* Kremlin-run voting begins Friday in Russia-held regions of Ukraine
* Central banks around the world hike rates after Fed increase
* US Leading Economic Index fell for sixth straight month in August
* Investor pessimism returns to 2008-era high via BoA survey
* Eurozone contraction deepens in September, according to PMI survey data
* UK business activity falls at quickest rate since January 2021 via PMI survey data
* US jobless claims edged up last week but remain near historic lows:

The Federal Reserve’s ongoing policy tightening to tame inflation is treading a treacherous road that risks recession, says analyst. “The margin of error now is very thin,” advises Robin Brooks, chief economist at the Institute of International Finance. “A lot of this comes down to judgment, and how much emphasis to put on the 1970s scenario.”

Bridgewater’s Ray Dalio says a US recession is likely within the next 12 months. “Right now, we’re very close to a 0% [growth] year. I think it’s going to get worse in 2023 and 2024, which has implications for elections,” he reasons. “They need to get interest rates — short rates and long rates — up to the vicinity of 4.5%-ish, it could be even higher than that,” he predicts, adding that the main way to fight inflation is with “economic pain,” which the lowers pricing pressure.

Stocks may not bottom until Fed’s policy tightening unleashes more pain, predicts analyst. “The message from the Fed is that ‘We’re going to keep hiking until something goes wrong,’” advises Bespoke Investment Group Global Macro Strategist George Pearkes. “The fact that nothing’s broken yet tells us we’re not done. If the Fed is in that mood, how are markets supposed to bottom?”