Global Asset Class Returns: U.S., Tech Stocks Off to Bad Start

Below we highlight the year to date returns of the major indices for a number of countries. As shown, U.S. indices are leading the declines, with the Nasdaq already down 8%. BRIC countries (Brazil, Russia, India, China) are holding up relatively well, as Russia, India and China are actually in the black for the year.

Looking at various asset classes, U.S. equities and real estate are leading the declines. The Dow Jones Real Estate index is down 10% and the S&P 500 is down 5.3%. Volatility is leading the way, up 13%, followed by Gold (+5.9%), the 10-Year (+1.93%) and Oil (+1.04%).

On a sector basis, Technology stocks are down the most at -9.96%. Tech is followed by Financials, Consumer Discretionary and Industrials. The two sectors up on the year are Utilities and Health Care. If one were to draw up the likely performance of sectors and assets leading up to or during a recession, it probably couldn't get more similar than what is actually happening now. But like Obama's 95% odds of winning the New Hampshire primaries on Intrade yesterday, markets can get it wrong.

Comments

[goatfarmer]

Can we draw any sensible conclusions from a 2 week analysis?

[Geoffrey Lordi]

Goatfarmer - the time period might be relevant to those with short time horizons. I've recently fielded some questions re: how good a move into FXP would be considering China's recent floundering...I'm glad we didn't consider it yet, as it was down heftily on Wednesday.

Many folks had counted China as "needing" a breather (whether you or I agreed with that or not)...And the talking heads on CNBC, Bloomb., et al, have been flapping about Germany, Sweden, and Mexico as worthy, safe, "alternatives&quo... So, yes, I believe 2 weeks' analysis is meaningful - especially if some folks had planned to move from China/HK holdings into "sounder" European holdings (despite our thoughts - or, at least, mine - that Europe is not considerably safer than the US)...

Best,
Geoff L