Stock Indices recovered since 2008

Lehman Brothers Inc collapsed on 15 September 2008 under the weight of sub-prime mortgage crisis of US that started in late 2007. The world’s stock markets spiraled precipitously downwards after that single event. I wrote a blog post comparing stock indices between 2 January 2008 and 24 October 2008 (pre- and post-Lehman Brothers). On average, major stock markets declined 45% since the start of 2008. STI fared worst than this average at 53.7% reduction. See table below.

  2 Jan 2008 24 Oct 2008 7/8 May 2013
STI 3,461 1,600 3,416
Nikkei 225 14,691 7,649 14,285
Sensex (Mumbai) 20,465 8,701 19,958
FTSE 100 (UK) 6,416 3,883 6,560
Australia All Ord 6,434 3,831 5,177
Hang Seng 27,560 12,618 23,215
Shanghai Comp 5,272 1,839 2,246
Dow Jones Ind 13,043 8,378 15,056
S&P 500 1,447 876 1,625
Nasdaq 2,609 1,552 3,396

Looking at stock markets in recent days, it seems that investors have put the global financial crisis of 2008/09 behind them.

The Straits Times Index (STI), Nikkei 225, Sensex (Mumbai), FTSE 100 (UK) are now near the levels set at the start of 2008.

The US stock markets are in exuberance mood with Dow Jones Industrial Average, S&P500 and Nasdaq overshooting the levels seen in 2008.

The laggards were Shanghai Composite, Hang Seng Index and Australia All Ordinaries Index. They are still far from the levels set in January 2008. This group seems to be closely linked with the China economy.

Copyright © 2013, 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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