World Markets Weekend Update: The Rally Resumes

Seven of the eight indexes on our world watch list posted gains over the past week, a reversal of the one up, seven down pattern the week before. Germany’s DAXK was the top performer, up an astonishing 6.57%. Its European companions finished second and third: France’s CAC at 5.19% and the UK’s FTSE at 3.32%. Japan’s Nikkei and the US’s S&P 500 also finished with gains fractionally above three percent. China’s Shanghai Composite was the sole loser, down a modest 0.34%.

The Last Four Weeks

The tables below provide a concise overview of performance comparisons over the last four weeks for these eight major indexes. We’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.

Year-to-Date Performance

Here is an overlay of the eight illustrating their comparative performance so far in 2016.

Here is a table of the 2016 performance, sorted from high to low, along with the most recent highs for the eight indexes. Six indexes are in the green year-to-date, up from four the previous week, The DAXK and CAC 40 joining the YTE winners. The FTSE remains the top performer with the S&P 500 close behind. China’s Shanghai remains in the cellar.

Bear Market Perspective

The column chart is sorted by the least to worst declines from previous peaks as of the week’s end. Seven of our eight watch list indexes had dropped into bear territory (a 20% decline), the S&P 500 being the sole exception. As of the latest close, two indexes are in the bear zone, unchanged from the previous week, but Hong Kong’s Hang Sing is poised on the -20% benchmark.

A Longer Perspective

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 DAXK 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 using a log scale vertical axis, we get an excellent visualization of the relative performance. We’ve indexed each of the eight to 800 on the March 9th start date. The callout in the upper left corner shows the percent change from the start date to the latest weekly close.