The biggest losers: Global stock market edition

Sure, the Dow and S&P 500 have been in sell-off mode lately. But the losses are way worse in places like China and Ar...

Posted: Feb 9, 2018 4:56 PM
Updated: Feb 9, 2018 4:56 PM

Sure, the Dow and S&P 500 have been in sell-off mode lately. But the losses are way worse in places like China and Argentina.

The Dow Jones industrial average and S&P 500 plunged just over 10% after hitting all-time highs in late January. The Nasdaq dropped by 9.7% too, though the indexes are now staging a small bounce back on Friday.

Concern about rising inflation, interest rates and bond yields in the United States helped trigger the selling around the world.

"Whilst the recent declines in the U.S. have attracted the lion's share of attention, the major benchmarks have actually [performed] relatively well compared to several other international indices in recent sessions," said David Cheetham, chief market analyst at the U.K. brokerage, XTB.

The biggest companies in the world -- in both developed and emerging markets -- lost $5.2 trillion in market capitalization since recent market peaks at the end of January, according to S&P Dow Jones Indices estimates.

Here are some of the markets that did particularly poorly this week:

China

The Shanghai Composite has dropped by 14.6% since hitting a two-year high in late January. The Hang Seng in Hong Kong has lost 13% over the same period.

Niklas Hageback, founder of Hong Kong hedge fund Valkyria Kapital, said he believed the Hang Seng in particular had been "severely overextended." It rallied by 36% in 2017 and kept surging to all-time highs in January.

"This has been the most overbought situation since the financial crisis 10 years back," he said. "A correction was imminent, and once the U.S. market started to show weakness, the fall has been extensive, especially for mainland financials and property stocks," he said.

The Shenzhen A-Share index -- which was left out of the global stock market rally in 2017 -- sold off the most. The index is down 15.4% since hitting a recent peak in late January.

"Chinese domestic markets do show some correlation to other markets in terms of sentiment during these extreme bouts of volatility, however ... they still represent an attractive investment case," said Francois Perrin, a portfolio manager at East Capital. He said now is a good time to "start bottom-fishing" and pick up certain stocks for cheap.

Related: Here's exactly what happened during the stock market's crazy week

Argentina

Argentina's Merval index has dropped the most of all the global indexes. It's fallen by as much as 16% after setting an all-time high on February 1. It has since recovered a bit.

The index surged by 110% since the start of 2017 to its peak this month, so it's no surprise that this star performer fell along with the rest of world.

Edward Glossop, an emerging market economist at Capital Economics, said the drop isn't anything to be concerned about following a long-running rally. But he suggested the fall may have been exacerbated by concerns about recent central bank policy related to inflation.

Related: Stocks flew too close to the sun. Now what?

Japan

Japan's Nikkei index was swept up in the selling this week. It hit its highest level in late January since the early 1990s but has since dropped by 12.6%.

"In a market like this with such an abundance of liquidity, sector diversification and stock picking are almost meaningless, and sell-offs tend to be across sectors and markets," noted Hageback.

Europe

European markets have also fallen this week, but some have fared worse than others.

Specifically, the Dax 30 in Germany has lost 11.7% since hitting an all-time high in late January. And the Stockholm 30 lost as much as 11.5% since a recent peak in early November.

Many other European indexes have dropped by roughly 9% and 10%.

Africa

The FTSE JSE All-Share index in Johannesburg, South Africa, fared poorly over the past few days, down by as much as 11% since hitting an all-time high in late January.

"Even though the epicentre of the sell-off appeared to be developments in the U.S., it is not surprising that South African equities have been hit hard too," said Oliver Jones, an economist at Capital Economics.

"Historically, equities in emerging markets have always tumbled when the U.S. stock market has experienced a correction, even when the cause of the correction has had little or nothing to do with emerging markets. This reflects investors around the world retreating from 'risky' assets," he said.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 500286

Reported Deaths: 9968
CountyCasesDeaths
Harrison34281537
DeSoto32039402
Hinds31911626
Jackson24466379
Rankin21971390
Lee15501235
Madison14566279
Jones13825242
Forrest13438250
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Lowndes11003188
Lamar10510135
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Hancock7727126
Washington7418157
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Monroe6765176
Warren6679176
Pontotoc6655102
Neshoba6625206
Panola6511131
Marshall6460134
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Union601294
Pike5815152
Alcorn5662101
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Scott472198
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Clay307676
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Clarke292194
Calhoun278945
Holmes267887
Smith263350
Yalobusha233347
Tallahatchie226851
Walthall218763
Greene218248
Lawrence212440
Perry205256
Amite204755
Webster202646
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Jefferson Davis171442
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Humphreys129238
Franklin119428
Quitman106428
Wilkinson104839
Jefferson94434
Sharkey64020
Issaquena1937
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Alabama Coronavirus Cases

Cases: 815989

Reported Deaths: 15311
CountyCasesDeaths
Jefferson1144621915
Mobile723961330
Madison52114694
Shelby37488348
Baldwin37167547
Tuscaloosa35013606
Montgomery34031734
Lee23177245
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Covington6695184
Chilton6608161
Russell626659
Franklin5947105
Chambers5563142
Marion4966126
Dallas4902200
Clarke474083
Pike4722105
Geneva4567126
Winston4493103
Lawrence4286117
Bibb423686
Barbour356576
Marengo337489
Monroe330863
Randolph328263
Butler325396
Pickens314182
Henry311865
Hale310688
Cherokee301660
Fayette291379
Washington251151
Cleburne247160
Crenshaw244075
Clay241268
Macon231763
Lamar219547
Conecuh185753
Coosa179439
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Perry138440
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