2014 Global Market Review

理财投资Aurora

Since the end of 2013, investors were expecting market correction as none has occurred since 2011 European debt crisis and 2013 had such a tremendous run. S&P/TSX did correct 12%, but S&P only dropped 7%, albeit volatility did return during the last four months due to oil price war and QE ending, or more fundamentally financial cycles leapfrogged the business cycles in most countries. In the end markets around the world has diverged. US market continues to break record high, while Canadian market is deeply wounded by the oil price war. UK continues solid growth, setting tones for Bank of England rate hike, while the rest of the Europe falling apart. Russia suffered the most from the oil price war, ruble free fall despite central bank raised interest rate from 10.5% to 17%. China market soared despite a slower GDP growth and concerns about a shadow-financing blowout and torrid credit growth.

Here are the major events happened in the market during 2014:

1.     Russia Ukraine conflict erupted in Jan 19, sending S&P down 5.5%, followed by an 8% rebound.

2.     In July US Fed started the QE ending talk, S&P dropped 4%, followed by a 5% rebound.

3.     Sep 17-18 Fed meeting announced QE ending, causing S&P largest drop of the year 7%, followed by an 11% rebound. Note fed meeting is marked on the event calendar, so this is not unexpected.

4.     Starting in June oil price collapsed. Canadian market is concentrated in energy, material and financial. S&P/TSX started correction in September.

5.     Same time when oil price collapsed, Russian ruble collapsed.

6.     Shanghai index soared 34% in November and December two months alone

Read 2015 Global Market Outlook
2015 Global Market Outlook - Overview
2015 Global Market Outlook - US
2015 Global Market Outlook - Emerging Market
2015 Global Market Outlook - Developed Market