Stocks, bonds, and other investments are traded around the clock, on exchange floors and electronic markets around the world. Markets in London open before those in Singapore close, and London᾿s are still open when trading begins in New York.
Opening prices in Tokyo and Sydney markets reflect closing or after-hours prices in the U.S. And closing levels in Asia influence what happens in European markets the next morning. For example, if markets end down in Japan, there’s often an early sell-off in Germany or France.
Stock of some multinational companies, such as Sony and Nokia, trade on exchanges in more than one country. And some companies with headquarters in one country sell bonds in another country, priced in the currency of the country where they are sold. Yankee bonds, for example, are bonds of non-U.S. companies issued in dollars in the U.S.
The interdependence of worldwide markets and exchanges has grown more pronounced in recent years, as the electronic links between them have expanded. On the other hand, the economic and political situation in each country or region continues to have a dominant effect on that country’s or region’s markets.
