1/5 Of US Stocks And 63% Of EM Stocks Are In A Bear Market by Eric Bush, Gavekal Capital
Equity markets are quite tumultuous underneath the headline indices recently. For example, 21% of all MSCI USA stocks are at least 20% of its 200-day high. This is only the third time since the summer of 2012 that this many stocks are in a bear market. The most interesting aspect of this internal correction is the fact that the headline index is a mere 1.8% off the 200-day high. On October 10, 2014 when 21% of MSCI USA stocks were in a bear market, the headline MSCI USA index was 5.4% off the 200-day high. And on November 8, 2012 when 21% of the MSCI USA stocks were in a bear market, the headline index was 6% off the 200-day high.
The pain felt in US stocks is nothing compared to many markets around the world. Just a reminder that this all based on USD performance.
Canadian stocks have been getting pummeled. 68% of Canadian stocks are in a bear market. This is the greatest percentage of stocks in a bear market since 2011.
30% of MSCI Hong Kong stocks are in a bear market and 29% of MSCI Singapore stocks are in a bear market as well.
The true carnage is taking place in the emerging markets, however, where nearly 2/3 of all EM stocks are at least 20% off its 200-day high.
Some of the worst countries in EM are Brazil (82%), China (82%), Indonesia (77%), and Russia (81%).