Courtesy of Doug Short
With the exception of the Shanghai Composite, the world markets in this series all had a second exceptionally strong week, with the DAX and Bombay SENSEX leading the charge. A measure of the rally’s breadth is the fact that the S&P 500’s gain of 1.42% earned it no better than next-to-last place.
Here is a side-by-side comparison of the latest weekly performance with the week before. Amazingly enough, despite their magnitude, last week’s gains were well off the pace of the previous week.
The chart below illustrates the comparative performance of World Markets since March 9, 2009. The start date is arbitrary: The S&P 500 and Bombay 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, Bombay, Hang Seng) is readily apparent. However the pattern has been less apparent over the past few months.
