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Stocks , European Markets , US Markets

How This Bellwether Global Market Mirrors 2007

New records of financial optimism are being set in Europe and the U.S.

by Bob Stokes
Updated: December 03, 2020

You may recall the zeal with which many investors embraced many major global markets in 2007 – just as a big bear market was set to unfold.

One of those markets was German equities.

Now, here in the latter part of 2020, investors have once again jumped in with both feet.

Here's a chart and commentary from our November Global Market Perspective:


In October, Germany's Welt media published a version of this stunning chart, which depicts the behavior of German investors as they pushed a record €23.9 billion into the stock market over the first half of 2020.

The old record, which saw comparable buying interest, dates back to the last great investment mania in 2007. Investors [had] piled into the market long after the DAX had made its final highs. In fact, the DAX topped on July 13, 2007, with prices registering a slightly lower countertrend peak on December 12, 2007. Back then, in other words, complacency reigned for a full five months, as investors purchased shares under the mistaken belief that the old uptrend was intact.

Mistaken, indeed. Peak to trough, the DAX dropped 56% from 2007 to 2009.

Be aware that Europe is not the only continent where financial records are being set.

Let's travel across the Atlantic and take a look at what's going on with the IPO market in the U.S. This chart and commentary are also from the November Global Market Perspective:


Initial public offerings had two more big months in September and October. In October, 76 offerings came to market, exceeding the volume for any single month in 1999-2000, a period that is widely regarded as featuring the greatest IPO boom in history. This chart shows the new extreme.

Our Global Market Perspective discusses what these new extremes suggest for the weeks ahead. Plus, you'll also get coverage of 50-plus markets worldwide, including analysis of rates, metals, currencies (including crypto-currencies), energy and much more.

Follow the link below to start reading our Global Market Perspective now.

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Get timely financial insights into China, Japan, Australia, India, Germany, the United Kingdom, the United States and many more countries.

Follow the link below and you can have Elliott Wave International's comprehensive Global Market Perspective on your computer screen in moments (The new December Global Market Perspective publishes on Friday, Dec. 4 -- and yes, it's filled with fresh insights that are actionable now. Be among the first to read the December Global Market Perspective)

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