Why the stock market is so turbulent - Last week, global financial ma- Navbharat Times Photodhamal

1/13

Last week, global financial markets were churning, but it really only mattered if you were an oil trader, Chinese bureaucrat or hedge fund manager.

In This Pic : Sensex

Pic Courtesy : BCCL

2/13

Now it's starting to get scary for everyone. An 8.5 per cent drop in the Shanghai Composite index in Monday's trading session spread to financial markets across the world. In the United States, the broad Standard & Poor's 500 index was down 2.5 per cent in Monday morning trading, after steeper declines in Asian and European stock markets, falling prices for oil and other commodities, and a rush of money into the safety of US Treasury bonds.

In This Pic : Sensex

Pic Courtesy : PTI

3/13

What's fascinating is that there is no clear, simple story about what is different about the outlook for US and European corporate profits; interest rates; or economic growth compared with one week ago, when the S&P 500 was 8 per cent higher.

In This Pic : Sensex

Pic Courtesy : BCCL

4/13

Here's how to make sense of what is a truly global story, stretching from the streets of Shanghai, where stock investing has become a middle class sport in recent years, to the oil fields of both the Middle East and Middle America, to the hallways of power in the Federal Reserve in Washington.

In This Pic : Sensex

Pic Courtesy : BCCL

5/13

The immediate trigger to the outburst of global volatility was China, where the sharp drop in stocks Monday continued a rout that has been underway - with periodic pauses thanks to government interventions - all summer.

In This Pic : Sensex

Pic Courtesy : PTI