The market capitalization of global stock markets decreased by 20% in 2022, while the value of traded stocks declined by 10%, according to the World Federation of Exchanges (WFE).
The WFE’s 2022 Market Highlights report indicates that approximately $25 trillion was lost from international equity markets following two years of growth. The report identifies several factors contributing to the stock market downturn, including the aftermath of the Covid-19 pandemic, rising inflation, and the ongoing conflict between Ukraine and Russia.
Nandini noted, “We witnessed a perfect storm in 2022 of so many negative pressures culminating to bring immense pressure on global stock markets, as our report highlights.”
The report also shows that volumes increased to 48.32 billion last year, reaching their highest levels in six years. However, the number of initial public offerings (IPOs) and the capital raised both saw significant declines, dropping by 50% and 65%, respectively.
This report emerges amid a volatile period for global markets and the banking sector, particularly following the issues faced by Swiss bank Credit Suisse and the collapse of US-based Silicon Valley Bank. Simultaneously, the cryptocurrency exchange market is grappling with challenges stemming from the FTX bankruptcy and widespread layoffs at other exchanges.