Here Are the Countries' Stocks That Got Hit Hardest by COVID-19

• Author: Michael Bordonada
• Posted: 2024-07-07

COVID-19, or "Coronavirus", has undoubtedly had a catastrophic effect on the global stock market. Many portfolios that were booming are depressingly low, and some are wondering if they'll ever see numbers close to what they used to see in their accounts again. The quick answer is that most likely, these stocks and bonds will go back up in the near future. However, a few industries may be too damaged to return to normal.

Let's take a look at the countries whose stocks got hit the hardest by the virus. Remember, many of these are only temporary. However, stocks in China in particular may never rise to the full value they once were. This, of course, gives other countries who have stakes in the manufacturing industry a boost in the markets.

OECD Predictions

OECD is an international cooperative that provides general estimates for domestic and international stock yields each year. OECD initially predicted that coronavirus would hit some markets. However, now that there are tens of thousands of cases internationally, and the WHO has declared COVID-19 a pandemic, the OECD has re-submitted economic predictions for markets around the world.

Unfortunately, all markets are likely to be hit. This is because some regions are being put under full lockdown, which is likely to create panic and economic discord. Additionally, economic activity is faltering as events are canceled due to concerns about the virus, and people aren't engaging with their local businesses nearly as much as they used to yet.

The Worst Hit Markets: Asia

Asia is where you do not want to invest money right now. If you already have stocks there, that's fine. Do not panic-sell them. They will return to higher values than they are right now. The markets are in transition from "bull markets" to "bear markets" (this essentially means that we went from prospering to a downturn very fast), and the only amelioration for this comes in the form of time.

China is clearly the worst-hit market. With many stocks in China tied to manufacturing, full-on travel bans and manufacturing request halts from the country have led to significantly decreased economic output. China's GDP output increase prediction by OECD has dropped about a full percentage point from their original 2020 projection, which already factored in a drop from Coronavirus. A country that appeared to be poised to become a global superpower is now dipping rapidly.

Japan has been hit extremely hard by coronavirus, as well. Their GDP output growth wasn't even projected to be one percent. However, it was downgraded to about half a percent, and then further downgraded to just over zero percent for this year. For a small country, this is a "make it or break it" scenario. Right now, it seems to be breaking!

Moderately Hit: Europe

European stocks took a good hit, but not nearly the same hit that Asian markets took. Again, this is because many European countries are under partial quarantine, and COVID-19 cases have spiked in many major economic drivers of the region, such as Germany.

European GDP was set to increase by about one percentage point on average. It is now slated to increase by less than one half of a percentage point due to coronavirus fears. Unfortunately, there isn't much that can be done in this situation either, other than to bide your time. This would be a decent market in which to buy if you have the cash, since it will almost undoubtedly recover. Unlike Asian markets, mass deaths have not occurred in many of these countries, with the unfortunate exception of Italy.

Hit the Least: United States

The Trump administration has been putting out constant press releases to reassure investors that the United States is doing everything in its power to prevent the spread of COVID-19. From offering free testing to giving citizens basic health advice via the CDC, the United States has been relatively successful in containing the virus. While this country still had a minor GDP forecast downgrade from the original OECD forecast, it's fairly negligible.

In other words, investors see the brightest future in the United States. There may be less spreading of the infection because of rapid quarantine measures or the fact that people are more spread out.

The Major Takeaways

Remember, all of your stocks are bound to jump back up. It's not advisable to purchase Asian market stocks. However, European and United States stocks are almost certainly bound to go up, making them great buys if you have the cash.