Not all risk is priced the same. That's a financial fundamental, and one that's playing out in global stock markets — including in the Asia Pacific.
Major indices started the trading week with sell-offs whose intensity varied.
Japan's market was hit the hardest, with the two main stock indices falling more than 12% each. It's the worst percentage loss since the stock market crash of 1987.
South Korea’s main stock index fell nearly 9%, and Taiwan’s fell more than 8%.
The loss for Australia’s main index was nearly 4%.
But in Hong Kong and Shanghai, they were down less than 2%.
And when markets bounced back at their Tuesday open, some of those that fell the most also bounced the highest in initial trading.
Some reasons for these differences include how much enthusiasm — or gloom — was already priced into those stock indices.
For example, Japan’s Nikkei hit an all-time high just last month, while stocks in China were already down some 15% on the year before this week’s trading began. Hong Kong is a similar story.
