Nasdaq · February 3, 2014
The day emerging currencies shook
-2.61%
single-day change vs previous close
Part of a longer stretch
The climb back to the level of 2000
midway through · 2012-11-15 → 2015-04-23, +78.22% over the whole period
What happened that day?
- The Nasdaq fell 2.61% on the day
- US manufacturing data came in sharply worse. Severe winter weather played a part, but the market read it as a slowdown
- Over the preceding weeks the currencies of Argentina, Turkey and South Africa had each fallen hard
- The background was the Fed beginning to reduce its bond buying. When US rates rise, money that went to emerging markets comes home
- The pattern repeats — money flows out to emerging markets while the US is easing, and leaves all at once when it starts to tighten
- The 2014 episode settled within weeks, and the Nasdaq made new highs again in the spring
Sources
Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.