The Global Stock Market Has Launched A Big Counterattack Like The Rainbow.

Yesterday's global market plunged the market into a panic. The Royal Bank of Scotland even shouted that in addition to selling high-quality bonds, the prime culprit on Friday (January 22nd) caused a collapse. Many top investment bankers believe that the main cause of the global stock market's diving is international oil prices.

In the past, the stock market used cheap fuel costs as a factor of interest, but the situation in 2016 was different. Cumberland consultancy quantitative analyst Leo Chen said that when oil prices fell below 40 US dollars in December last year, the correlation between oil prices and stock market began to become very tight.

Since then, the correlation between the Brent crude oil futures price and the US Standard & Poor's 500 index has reached an incredible 91.39%.

Generally speaking, the stock market used cheap energy costs as a plus factor, but when low oil prices meant downside risks to global economic growth, and the risk began to rise in 2016, the market was on the rise.

The negative factors have overshadowed the positive effects of low oil prices.

"The collapse of commodity prices is not just caused by the imbalance between supply and demand of these commodities, but the market has begun to believe that the global economy has not returned to growth and may be approaching the recession," said Olivier, executive director of Axioma Asia Pacific, an investment Risk Management Inc.

And JP Morgan's research newspaper explains that the bridge between the stock market and the oil price is a huge sovereign wealth fund.

JP Morgan said in a January 18th report that from the oil market to

The sell-off was triggered by sovereign wealth funds.

Besides,

The Norway sovereign wealth fund, which is US $830 billion, is the largest sovereign wealth fund in the world.

Norway's sovereign wealth fund recorded its biggest loss in four quarters in the three quarter of 2015, due to a 21.3% loss in A share investment and a collapse in Volkswagen's share price, reaching 8.3%.

According to JP Morgan's view, if the oil price is maintained at $31, these sovereign wealth funds will clear $75 billion in 2015, and the lower the oil price, the bigger the figure.

As early as late 2015, the US report warned the financial market with cover stories. As the oil price collapsed, the scale of sovereign wealth funds, which depend on oil exporting countries, began to shrink.

Sovereign wealth funds such as Norway, Saudi Arabia, Kuwait and other countries have withdrawn from Fortune Management Inc and global stock markets in the past few months. Oil prices have long been at a low level, threatening the oil producing countries' financial revenues. They have to use sovereign wealth funds to maintain their finances. These sovereign wealth funds rarely or even never disclose assets, causing potential turmoil in the global financial market.

For example, data show that Saudi Arabia, a country with serious foreign exchange reserves, has been one of the biggest sellers in the Korean stock market since the second half of 2015.

The data disclosed by the Korea financial supervisory authority showed that Saudi Arabia sold Korean stocks for 6 consecutive months in 2015, which amounted to about $3 billion 100 million.

By the end of November 2015, Saudi Arabia's currency authority had sold nearly $2 billion in European stocks.