If it seems as if the bottom is falling out of international markets, it isn't your imagination. Eighty percent of world markets were down over the past week.
Most stock markets in more than 60 countries have had a difficult week and two-thirds are down over the last two years. Greek stocks are at their
Of course, that's concerning — we live in a global economy and the world's markets tend to move together. But some markets tend to move along with the S&P 500 more than others. Based on our analysis of stock market data in each country, the nearest neighbors to the U.S. tend to move with the domestic market market with a correlation coefficient of over 0.6. (A perfect correlation would be 1.0, no correlation would be zero, and negative correlation would be -1.)
European markets are also closely linked to ours, but markets in Asia and Africa tend to be less correlated. Some markets are more likely to move opposite ours, with slightly negative correlation coefficients over the last two years. Here's the data for 62 world markets compared to the S&P 500 (as of Thursday's close):