Charted: Global stock markets recover from pandemic-era plunges
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The S&P 500 has been the clear winner among major stock markets in recent years, thanks to enormous technology companies. But the whole world has managed to recover pretty well from the 2020 crash.
Why it matters: The S&P 500's outperformance isn't really a function of American exceptionalism. U.S. small caps, for instance, as measured by the Russell 2000, are significantly underperforming France and Germany, and are barely outperforming Brexit-wracked Britain.
Between the lines: While Japan's Nikkei tops major markets in terms of its five-year returns, it looks much less impressive in dollar terms.
- It's also worth noting that the Nikkei's 35-year return, in local currency terms, is +20%, compared to +1,740% for the S&P 500.
The big picture: Deglobalization is visible everywhere except the stock market, where technology megacaps are reaping the benefit of global domination.
- That said, it's great news that almost everywhere has seen a reasonably healthy five-year return, given that in early 2020 global markets all plunged in the face of the deepest and sharpest recession since the 1930s.
The bottom line: Sharp plunges generate headlines and panics — but are often short-lived.
