The new novel coronavirus variant is now the top concern for financial markets, followed by inflation and economic growth, according to Deutsche Bank's monthly market sentiment survey for July released on Monday.

In recent weeks, the surge in novel coronavirus Delta cases has shaken the market, adding to fears that global economic growth may have peaked.

Deutsche Bank surveyed about 550 market professionals around the world from July 21 to 23. More than 60 per cent of respondents said they thought the new novel coronavirus variant was more worrying than when it became the highest risk in the market in April.

Inflation concerns ranked second in the survey, followed by concerns about economic growth. Most respondents said they thought the rise in inflation was temporary, similar to the views held in May and June.

More than 51 per cent of respondents said they expected average inflation in Europe to be between 1 per cent and 2 per cent over the next five years and would not exceed the ECB's target.