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Monday
Oct042010

Kiss the Financial Crisis Goodbye!

At just under 1,140, the S&P 500 sits more than 400 points (or 27%) below its all-time high of 1,565.15 made on October 9th, 2007.  Imagine for a moment how nice it would be if the S&P 500 had already recovered all of its losses from the collapse and was now trading back into the 1,500s.  If you live in Mexico, India, Malaysia, or Brazil, this is your reality right now.  The financial crisis is now in your rearview mirror. 

Below we highlight the current distance from the highs made prior to the '07/'08 global bear market for the major equity indices of 22 key countries around the world.  As shown, Mexico is currently 3% above its pre-collapse high!  India's Sensex is just 2% from its prior high, while Malaysia and Brazil are just 4% off.  South Korea is the only other country that is less than 10% from its pre-bear market high.  As noted earlier, the US is 27% from its all-time high, which is just about in the middle of the pack of the countries shown.  China and Italy are the farthest away from the highs they made back in 2007.  China's Shanghai Composite is currently 56.41% below its high made on 10/16/07, while Italy's FTSE MIB is 54.71% below its high made on 5/18/07.  Japan's Nikkei 225 is the 3rd worst at -49%, France (CAC-40) is 4th worst at -40.83%, and Russia (RTSI) is 5th worst at -38.15%.

The "BRIC" acronym became a household name in the mid-2000s as the 4 emerging countries that BRIC represents experienced big economic and market returns.  While all four countries (Brazil, Russia, India, China) are still seeing pretty solid economic growth, their equity markets have taken extremely divergent paths recently.  India and Brazil are just about back to all-time highs, while Russia and China are basically half of their former selves.

Below are price charts since 2007 of the Mexican Bolsa Index, India's Sensex Index, the S&P 500 Index, and China's Shanghai Composite Index. 

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  • Response
    Response: indexer
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    Response: 50% off
  • Response
    Response: economic Recession
    Bespoke Investment Group - Think BIG - Kiss the Financial Crisis Goodbye!

Reader Comments (4)

A better take on your commentarie is if you put everything in dolar terms. the EWW (mexican tracker) was above $60 precrisis and today is around $54. The malaysia Ishares is around 10% above the high in 2007

October 4, 2010 | Unregistered CommenterPacami

You forgot about Turkey!

October 5, 2010 | Unregistered CommenterFMT

The financial crisis isnt over, it has just morphed.

The Fed has printed 2.5T to expand the monetary base and aid the banking system. At some point that liquidity must be removed before the money supply expands by a similar amount and leads to massive inflation. The Fed, which never saw the DOT.com bubble and never saw the housing bubble, must remove the RIGHT amount of liquidity and the RIGHT time. Too much too soon = depressionary downward spiral of prices and wages and output. Too little too late = run away inflation that makes 1979-80 (The CPI hit an annual increase of 20% in 1Q 80)look tame by comparison. Anyone think the Fed will act at the right moment and in the right amount??? No the crisis has not ended by any means. The worst maybe yet to come.

October 5, 2010 | Unregistered Commenteremo

Argentina at ALL TIMES HIGH currently...(in local currency nominated, off course)

October 5, 2010 | Unregistered CommenterTony

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