August 17, 2018
We haven’t seen carnage like this in the global financial marketplace in quite some time.
On Wednesday, U.S. stocks were down some, but things were much, much worse around the rest of the world. Global banking stocks are plunging, emerging market stocks are cratering, and emerging market currencies continue their stunning decline. This represents a dramatic change from the relative stability that we have seen throughout most of 2018. It is almost as if someone flipped a switch once the month of August began, and the shakiness of global financial markets has many investors wondering what trouble fall will bring. What we are witnessing right now is not a full-blown panic yet, but it definitely has the potential to turn into one.
The term “bear market” is being thrown around a lot lately, but a lot of people don’t understand what a “bear market” actually is.
A bear market is generally considered to be when we see a decline of 20 percent or more from the 52-week high, and after the carnage of this past week a lot of those thresholds are now being crossed.
It would probably be too early to call this a “global stock market crash”, but we are well on the way to getting there. The following are 5 signs that global financial markets are entering a bear market…
#1 Global stocks have now fallen beneath all key moving averages. Those key moving averages are important psychological thresholds for investors, and if we have a few more days like Wednesday we could see global financial markets go into full panic mode.
- A d v e r t i s e m e n t
#3 Global banking stocks are down a whopping 23 percent from the peak established earlier this year, and that means that they have officially entered a…