As per a report from john Hopkins university, the US, which comprises of 4% the world’s population, has over 32% of the confirmed COVID cases. The situation has formed a negative impact on a global basis on the US stock as of the 300000 global death, 28% comprises of the US. However, even due to the situation, domestic stocks like MSCI and ACWX, roughly 10% of the index have fallen off the 20% global peers in 2020. The COVID pandemic is nothing new in the lists of recession, which was experienced long back in 2008-2009. The US stocks have performed better by 1% per annum over the horizon, whereas the domestic stocks have underperformed. The Japanese stock index reports are higher than the US; even every other report outside of the US has outperformed it.
The main thing to ponder in the scenario is about investors and whether the ones with concentrated risks should seek to diversify globally. With reports from acwx at https://www.webull.com/quote/nasdaq-acwx , one can analyze the data fundamentally and financially.
Factors causing US stock downfall
Ignoring the condition, from the initial graphs at acwx, it is visible that US stocks had been performing poorly even in a liquidity-driven drawdown that hit on the march. Since then, US stocks have maintained the trend of performing poorly. Three interrelated reasons are likely to be the cause of this.
- The status of the currency of the US dollar as the world reserve currency has pushed below the US interest rates creating an atmosphere of inflation in US asset rates. The US holds its position in the center of the world community, which contributes to the nation in times of need and crisis. The position of the US in also amongst the established law and deep and liquid capital markets.
- Compared to other economies, fiscal policy and monetary policy response in the United States have been much larger, which at this time frame has made a decline in risk assets. However, the extent of the lockdown will estimate the exact downfall; the fiscal and monetary power of the US has been deployed and unrivaled with rapidity in the current situation.
- The technology of the US market at the global place contributes to 10% of it and 26% of the total US equity market. These technologies have also outperformed in this crisis, leading to an increase in workforces online. This has also lead to an increasing gap between global peers and US stocks.
The much detailed analysis can be obtained from the accurate data on acwx for better financial analysis. The US holds one of its biggest advantages in the military matters by having two big oceans bordering the nation. Browse to the acwx for a higher analysis of US stock performance vs. global peers. You can also check aaxn at https://www.webull.com/quote/nasdaq-aaxn .