As the rest of the world woke up Wednesday to all-time highs for U.S. stocks, it would be the only natural for a wave of jealousy to accompany the incredulity. Many global markets, particularly those in Japan and China, remain a long way below their record peaks and for reasons little to do with the coronavirus. While the feeling of envy might be strongest in Shanghai, where stocks are still over 40% down from their 2007 peak, spare a thought for Japan’s beleaguered investors who last saw a record high back in 1989.
Broken Record
Many of the world’s major benchmarks still well below record highs
Source: Bloomberg
The S&P 500 Index climbed 0.2% to close at 3,389.78 on Tuesday, capping the fastest-ever return to a record after a drop of at least 20%, as investors looked past a collapse in the U.S. economy, bought technology shares and focused on the unprecedented fiscal and monetary stimulus from policy makers. Meanwhile, MSCI’s global gauge of stocks excluding those from the U.S. remains 20% off its high, which was reached in 2007.
“Many continue to wonder why stocks are at new highs with 10% unemployment and nearly a million people filing for initial unemployment claims,” said Ryan Detrick, chief investment strategist for LPL Financial LLC. “The truth is economic data is backward-looking and stocks are looking ahead to a much brighter future.”