Singapore equity portfolio lost value during Japan earthquake

Natural disaster such as the recent earthquake and tsunami experienced by Japan has impact on equity investment. The resultant nuclear crisis at Fukushima Daiichi nuclear plants added more pressure on portfolio value.

The Japan earthquake and tsunami happened on Friday, 11 March in the afternoon. The catastrophic destruction to lives, buildings and infrastructures were aired on TV and web over the weekend that followed. As if this is not enough, two Fukushima Daiichi nuclear reactors blew up over the same weekend.

When the Japan stock market opened on Monday, 14 March, the Nikkei 225 Index lost 6.1 per cent. On Tuesday, the loss was even steeper, at 10.5 per cent. Over a span of two days, Nikkei collapsed from 10,254 points to 8,605 points (16.0 per cent decline).  Thankfully, the Nikkei gained some grounds this week to end at 9,449 points today, a 7.8 per cent loss before the earthquake.

Singapore stock market declined as well over last week but not as badly. The Straits Times Index (STI) lost 3.5 per cent over last week (from 11 March to 18 March) to end at 2,935 points. Since the low point on Friday, STI recovered 2.9 per cent to end at 3,022 points today, which nearly regaining all the losses.

My Singapore equity portfolio followed the same pattern as the STI. It lost its value to end at 8.5 per cent below cost on Friday, 18 March. It is now back up at a smaller loss of 5.2 per cent. (I had started off with about 3.5 per cent loss before the Japan earthquake and today’s value is closer to that before the crisis.) I had held on to my stocks and waited out for the market to come to its senses.

During last week, I was nervous as the Japan nuclear crisis unfolded. I was hoping that the nuclear crisis would not develop into a catastrophic disaster for two reasons, firstly further human tragedy should be avoided and secondly economies of nations would not be adversely affected. As the nuclear crisis has not been resolved yet, one can only hope that events will not turn out for the worse.

Copyright © 2011, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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