A Tally of The Impact of Japan’s Disaster On Global Stock Markets

Japan’s triple whammy of nuclear-earthquake-tsunami has likewise slammed on the world’s stock markets.

Developed economy stock markets which earlier this year had outperformed the world have been the hardest hit, and are now laggards

Here is an update of the performances of the world’s bourses since Japan’s disaster struck.

According to Bespoke Invest,

The average year to date stock market performance of the 79 countries listed has now turned negative (-2.20%). The average performance of the countries since 2/18 is -4.38%. As shown, Japan is down the most since 2/18 with a decline of 16.13%. Germany and France rank 2nd and 3rd worst with declines of 12.29% and 11.08% respectively.

Most of the world’s market has turned red. Although some like the BRICs (except Brazil) and ASEAN has been little scathed so far.

However, with the way the markets have been performing overall (I mean, currencies, bonds, commodities, stocks), I suspect that Japan’s calamity has only instigated and could be masking the unseen driving force behind the series of downdraft.

And it’s called the TIGHTENING of the monetary environment—as many EM central banks have been raising interest rates while authorities of developed economies seem to be conditioning the markets of the same prospective actions despite the calamity. I’d like to see more evidence on this.