World Markets Update
Weekend market review, courtesy Doug Short.
Last week, the first week of the 3rd quarter, was a mixed bag for the eight world markets on my weekly watchlist. Half posted gains, half losses, with the average of the eight in the modest green at 0.32%. The fractional positive skew is attributable to the top performing Hang Seng and the close runner-up FTSE 100. Second thoughts in the aftermath of the previous week’s EU summit put the German index just below break-even and sent the French index to the bottom of the list. The S&P 500 finished next to last on ghostly post-holiday trading volume and disappointing employment data.
The table inset in the chart below shows that four of the eight markets are in bear territory — the traditional designation for a 20% decline from an interim high, unchanged from last week. However, the German index is only fractionally above the bear stigma. In our gang of eight, the S&P 500 remains the closest to an interim new high, down 4.54% from its April 2nd peak. At the other end, the Shanghai Composite is nearly 36% off its interim high of August 2009.
As for year-to-date performance, here is a table showing the 2012 peak percentage gains, sorted in that order, and current YTD gains for the eight indexes. Last week the FTSE was the sole index with a YTD loss, but last week’s rally moved it into positive territory. The various gaps between 2012 highs and the YTD performance continues to highlight the worldwide volatility in equities this year.
A Closer Look at the Last Four Weeks
The tables below provide a concise overview of performance comparisons over the past four weeks for these eight major indexes. I’ve also included the average for each week so that we can evaluate the performance of a specific index relative to the overall mean and better understand weekly volatility. The colors for each index name help us visualize the comparative performance over time.
The chart below illustrates the comparative performance of World Markets since March 9, 2009. The start date is arbitrary: The S&P 500, CAC 40 and BSE SENSEX hit their lows on March 9th, the Nikkei 225 on March 10th, the DAX on March 6th, the FTSE on March 3rd, the Shanghai Composite on November 4, 2008, and the Hang Seng even earlier on October 27, 2008. However, by aligning on the same day and measuring the percent change, we get a better sense of the relative performance than if we align the lows.
A Longer Look Back
Here is the same chart starting from the turn of 21st century. The relative over-performance of the emerging markets (Shanghai, Mumbai SENSEX, Hang Seng) is readily apparent.
Check back next weekend for a new update.