How much have the global stock markets recovered since the 2008 Financial Crisis?
What have been the returns since then?
What do we need to see for a full recovery?
These questions will be answered in the following article. Let’s take a look at a chart comparing the major global indices.
- Tokyo Nikkei Index (NIKI)
- Dow Jones Industrials (DJI)
- Standard & Poors 500 (SPY)
- German Frankfurt DAX (FDAC)
- India Bombay SENSEX (BESEN-X)
- Hong Kong Hang Seng (HKHS-X)
Since the Financial Crisis, we see that the Dow & S&P 500 have recovered to close to the 2008 highs. The SENSEX and German DAX have had a lower performance but are still 10% away from full recovery. The Hong Kong Hang Seng and the Japanese Nikkei have performed the worst. The Nikkei is still almost 50% below a recovery, a sign of a truly sick economy and a very bad situation for investors.
What is interesting is that if you had an investment that tracks the performance of any of these indices, you would have made no money over the last for years and in the case of the Nikkei, you still have a very long way to go to recover your investments.
For the markets to truly recover the investments made we would still need to see a 24% increase from here to account for 4 years of 6% average gains that we have missed for the last 4 years.
Does the market have 24% left in it? Probably as long as the fundamentals in the economy continue to move in the right direction.