Global Stock Markets Hit by COVID-19 Lose KRW 7000 Trillion in Market Cap in 38 Days... Four Times South Korea's GDP

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyung-min] As the novel coronavirus infection (COVID-19) has struck the world, the market capitalization of global stock markets has decreased by more than 7000 trillion won in just 38 days.

On the 1st, Bloomberg compiled the market capitalization of stock markets in 86 countries and found that as of the 27th of last month (local time), the market capitalization of these major countries was $83.1576 trillion (about 10,153 trillion won), down $5.9988 trillion (6.73%) from the peak of $89.1564 trillion on January 20th before the COVID-19 shock fully materialized. Converted to Korean won, 7290 trillion won evaporated in 38 days. This is about four times South Korea's gross domestic product (GDP) of 1893 trillion won in 2018.

By country, the U.S. stock market's market capitalization decreased the most, from $35.5154 trillion to $33.1276 trillion, a drop of $2.3878 trillion (6.72%). Japan ($6.2739 trillion → $5.6631 trillion), Hong Kong ($5.6858 trillion → $5.3327 trillion), and the United Kingdom ($3.4479 trillion → $3.1328 trillion) followed.

During this period, South Korea's stock market capitalization (from $1.4768 trillion to $1.2864 trillion) decreased by $190.4 billion, ranking sixth in terms of the amount of decrease. In terms of the rate of decrease, South Korea fell by 12.89%, ranking 10th among the surveyed countries. When considering only the most recent ten days, South Korea's stock market capitalization decreased by $147.8 billion (10.31%), showing the highest rate of decrease among the 86 countries.

Among the 86 countries surveyed, 76 countries saw their stock market capitalization decrease, but 10 countries, including Portugal, Luxembourg, and Kazakhstan, actually saw increases. China’s market capitalization dropped by $721 billion (9.61%) in just one day on the 3rd of last month after reopening following the Lunar New Year holiday, but thanks to government stimulus policies and the stabilization of COVID-19 spread, the stock market partially recovered losses, resulting in a decrease of only $52 billion (0.66%) during this period (from $7.851 trillion to $7.799 trillion).

As fears grow that COVID-19 could escalate into a global pandemic, there are forecasts that global stock markets may continue to decline for the time being. Norihiro Fujito, Chief Investment Strategist at Mitsubishi UFJ Morgan Stanley Securities, warned, "COVID-19 now looks like a pandemic," adding, "At this point, no one can judge how long this will last or how severe it will be."

This content was produced with the assistance of AI translation services.