The Stock Market's New Obsession: Is Shanghai A Leading Indicator?

Following last night’s big selloff in Shanghai, taking the Shanghai Composite decisively below 3,000, there’s a lot of chatter about whether Shanghai is a forward indicator for US stocks.

Here’s a zoom-in to the market’s crisis lows, and as you can see, Shanghai bottomed and started rebounding before the S&P 500.

chart

But that’s just one data point. To actually establish a pattern, you’d want to see this kind of thing over and over again.

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