Fri 21 Mar 2008
Global stock markets: Index movements since highs
Posted by Prieur du Plessis under Money, Markets, Investment
The long weekend affords one the opportunity to take a break from the markets’ frenzied trading and try and see things in perspective. More precisely, to reflect upon how much damage has been done since the stock market highs of a few months ago.
The table below shows the scorecard for a number of global stock markets, indicating the index movements since each of the respective market’s highs. The numbers (all in local currency terms) speak for themselves; suffice to say most are in bear-market territory based upon the traditional definition of a decline of more than 20%.
Source: Plexus Asset Management (based on data from I-Net Bridge)
Interestingly, the MSCI World Index (-16.8%) is still shy of the -20% level, whereas this level has already been breached by the MSCI Emerging Markets Index (-20.4%). Also, European markets have mostly been underperforming the S&P 500 Index (-15.1%) and the Dow Jones Industrial Index (-12.7%). So much for global economies decoupling from the US!
I do not have access to my normal research resources over the long weekend, but will publish a table next week with all the returns expressed in a common currency such as the euro. That should make for interesting reading.
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March 21st, 2008 at 1:18 pm
PdP: Interesting and I throw this out there for thought….global markets have broken down but copper only failed to hold its breakout….hmmmm
Anything you are reading that might shed light on this?
Thanks in advance
March 21st, 2008 at 2:22 pm
Thank you for this interesting, but scary chart… clearly shows how unstable global markets are.
March 21st, 2008 at 3:25 pm
Thanks for a very interesting backwards-looking chart…but far more interesting would be a forward-looking chart.
I’m well aware of the pain I’ve experienced recently. What I really need is to know is when the knife will strike a solid object…”are we there yet”?
March 21st, 2008 at 9:56 pm
Mr. Warren,
You will know when after the fact. If you are a bottom feeder, then test the waters. If you are wrong, test again, and again, and again. Eventually you will succeed if you have the staying power. Perhaps one should spend a tad bit of time studying $$ management. Anyone who has the ability to correctly pick tops and bottoms consistently, will not be sharing this information with you.
March 22nd, 2008 at 11:30 pm
It does take a number of years and cycles to become familiar with international markets. But even so, there are the unexpected political events that can throw individual nation and economic area indices out of whack.
While the subprime mortgage crises was building, who (except the banking industry) could have known that loosening (temporarily disbanding) certain regulations regarding borrower collateral requirements) could lead to the debacle we are in? The Fed under Greenspan would have known (from their study of the last Depression), but not many other people are students (or professors) of the Depression.
Whether Greenspan got his orders from the Republican Neocon administration, or whether he was the one who counselled the Neocons, is debatable. I rather think it was a self-serving mutual admiration society .. that took the US of A and the rest of the world for a ride.
March 29th, 2008 at 1:05 pm
This is a very helpful chart - it is data not so readily available without calculation elsewhere - one suggestion - add a column showing the low point for the cycle - it would answer the question e.g. has the S&P already been below the 20% loss level