Global Stock Markets' Worst First Half Ever... Global Stock Indices Fall 21%

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[Asia Economy Reporter Bu Aeri] In the first half of this year, the global stock markets posted the worst performance ever due to the prolonged Russian invasion of Ukraine and rapid interest rate hikes.

According to major foreign media on the 30th, the global stock index calculated by Morgan Stanley Capital International (MSCI) fell by 20.9% from January to June.

This surpasses the early 2000s dot-com bubble collapse and the 2008 global financial crisis, marking the largest decline ever for a first half-year period.

The index had dropped more than 22% in the first quarter of 2020 during the early spread of COVID-19, then rebounded nearly 20% in the second quarter of that year, but it has been on a continuous downward trend in the first half of this year.

In the U.S. stock market, the Standard & Poor's (S&P) 500 index fell 20.6% in the first half, marking the worst first half in 52 years since 1970.

In particular, stocks in consumer-sensitive and technology sectors experienced significant declines.

According to Bloomberg News, the total market capitalization of stocks classified as consumer stocks in the U.S. stock market decreased by about $1.8 trillion (approximately 2,325 trillion KRW) in the first half.

Among these, the S&P 500 Consumer Discretionary sector index, classified as a cyclical industry, fell 33.1% in the first half, recording the worst first-half return ever.

Additionally, during this period, it was the worst performing sector among the S&P 500 sector indices. Of the 58 stocks in this index, 55 declined, with online shopping mall Etsy plunging 67%, the largest drop.

European stock markets also performed poorly. The pan-European index Euro Stoxx 600 fell 9% in the second quarter, the worst since the spread of COVID-19 in 2020, and dropped 16.6% for the entire first half.

Domestically, the KOSPI and KOSDAQ indices fell 21.66% and 27.91%, respectively, in the first half of this year, and the stock market capitalization decreased by 489 trillion KRW from 2,650 trillion KRW to 2,161 trillion KRW over six months.

Not only stocks but also the global bond market performed very poorly due to the aggressive interest rate hikes by the U.S. Federal Reserve (Fed) and others. The yield on the U.S. 10-year Treasury note rose about 1.5 percentage points this year, the largest increase since the first half of 1994. Treasury prices fell about 10%. Bond yields and prices move inversely.

The cryptocurrency market also took a big hit in the second quarter. According to cryptocurrency information site CoinMarketCap, the total cryptocurrency market capitalization, which was about $2.04 trillion (approximately 2,636 trillion KRW) at the end of March, has dropped to around $890 billion (approximately 1,150 trillion KRW) as of this date.

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