Stock markets could suffer more near-term pain until investors get more clarity from central banks on how they plan to respond to the current market sell-off, said Fidelity World-wide Investment's global chief investment officer.
"In the short-term, markets will continue to be painful until we get more insight into how the central banks will respond," said Dominic Rossi, global chief investment officer at Fidelity World-wide Investment.
Rossi expected stock markets to come out of their "downward draft" by the end of the year, but advised investors against rushing in to buy up battered stocks in the wake of Monday's equity market slump.
"The best thing to do at the moment is to do nothing," said Rossi, whose firm is responsible for $87 billion in assets under administration.
"The way to enter these treacherous markets is very, very gradually," he added.
Rossi described the current environment as a "third wave of deflation", which would result in extremely challenging conditions for emerging markets.