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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 5:56 PM
Updated: Feb 9, 2018 5:56 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.

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 726600

Reported Deaths: 13379
CountyCasesDeaths
Marion992781737
Lake53359964
Allen40387675
St. Joseph35449550
Hamilton35440408
Elkhart28376439
Tippecanoe22336217
Vanderburgh22271396
Porter18637306
Johnson17876377
Hendricks17154314
Clark12919191
Madison12574339
Vigo12426245
Monroe11845169
LaPorte11773210
Delaware10615185
Howard9859215
Kosciusko9366117
Hancock8239140
Bartholomew8042155
Warrick7766155
Floyd7645177
Grant7019174
Wayne7018199
Boone6669101
Morgan6547139
Dubois6148117
Marshall6000111
Dearborn578577
Cass5780105
Henry5681102
Noble558283
Jackson500472
Shelby489496
Lawrence4492120
Gibson434391
Harrison434271
Clinton426853
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Whitley394439
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Knox371890
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Union70710
Ohio56211
Unassigned0413

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 1080121

Reported Deaths: 19344
CountyCasesDeaths
Franklin1254981392
Cuyahoga1115202107
Hamilton798171200
Montgomery512711012
Summit46997933
Lucas41982782
Butler38273580
Stark32190907
Lorain24910480
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Delaware18496131
Licking16396210
Fairfield16144199
Trumbull15996466
Medina15233262
Greene15027244
Clark13960297
Wood13056188
Portage12806201
Allen11609231
Richland11308198
Miami10659215
Muskingum8795132
Wayne8777210
Columbiana8756229
Pickaway8547121
Marion8511135
Tuscarawas8467243
Erie7859154
Hancock6900126
Ross6835152
Ashtabula6777169
Geauga6665148
Scioto6398101
Belmont5856167
Union570047
Lawrence5542102
Jefferson5511151
Huron5422119
Darke5344122
Sandusky5330120
Seneca5268121
Athens518258
Washington5148109
Auglaize488484
Mercer480185
Shelby468593
Knox4479110
Madison435461
Putnam4268100
Ashland421289
Fulton420969
Defiance418997
Crawford3965106
Brown392957
Logan381176
Preble379098
Clinton370561
Ottawa366279
Highland353861
Williams338075
Champaign330458
Guernsey315453
Jackson312051
Perry294550
Morrow283839
Fayette281449
Hardin270364
Henry268166
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Holmes2590101
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Pike237433
Adams237052
Gallia235048
Wyandot230654
Hocking215162
Carroll191247
Paulding172440
Meigs144639
Noble133337
Monroe131942
Morgan108323
Harrison107537
Vinton82415
Unassigned02
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We'll start Friday off dry, but the chance of rain returns. Scattered showers will be possible by late morning until the evening.
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