The financial model of the investment bank SocGen says that the US stock market could fall by a full 30% in the event that the emerging markets will continue the current trend of sad - Materials AMarkets.
The drop can make all 60% if the Chinese "hard landing" will be a reality.Sales of S & P500 index among global investors that have occurred this summer, showed just how nervous and impulsive investment community. The index of wide market S & P 500 lost 11% in just one week, Eurostoxx 50 fell by 16% and the Nikkei dipped by 13%. No matter which scenario is realized ("hard landing" in China or "lost decade" from emerging markets), in the event that the Chinese GDP will slow to 2% in the period 2015-2016. - Significantly increase the volatility and the market shares will be waiting just anything.
The stress scenario for the S & P500 by SocGen:
SocGen has 7 scenarios to protect the portfolio during the period of volatility: