Courtesy of Doug Short.
The pause in the 2012 worldwide rally went continued last week, the third consecutive week with an average performance of the eight indexes in our basket ended the holiday shortened week with a loss. Like the week before, five of the eight posted a negative number, and the numbers in the red were more negative than the week before. The Shanghai Composite, the last-place finisher the previous week, took the top spot with a 1.93% gain, although it was only open on Thursday and Friday following Ching Ming Festival closure.
Despite the selloff over the past three weeks, the adjacent table of 2012 year-to-date continues to show remarkable performance. The Nikkei remains in the top spot, although its 3.92% retrenchment last week has allowed the DAXK, despite its 2.8% loss, to pull into a close second. The S&P 500’s 11.71% gain, keeps it in the middle of the pack, although it has now fallen a notch to fifth place, swapping with the Hang Seng. The Shanghai’s gains lifted it from last to sixth place, with the FTSE now stuck in the cellar.
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.
Note from dshort: At the suggestion of Joerg Willig, a finance professional in Germany, I replaced the DAX index, which includes dividends, with the price-only DAXK, which is consistent with the other indexes.
