For Asian equities, 2018 was a tale of two halves, with record rallies and volume surges giving way to turbulence that’s wiped out $5.2tn in market value.
There’s no question about it. Investors in the region have had plenty to fret about - swings across assets, concerns over growth, escalating frictions between the two of the world’s superpowers and turmoil in Washington. As the final hours of 2018 tick off the clock, the MSCI Asia Pacific Index is down 22% from a January peak, with the recent rally doing little to ease the pain of what’s been the gauge’s worst year since 2011.
“There were very few safe havens which worked this year,” said Jason Low, senior investment strategist with DBS Group Holdings’s wealth-management unit. “Asian equities were not spared from the escalating trade war tensions and rising rates” and investors were likely surprised by the extent of the market impact, he said.
From the rout in technology stocks to a giant slump in the Chinese market, here’s a look at the most important themes driving Asian stock markets throughout a rough 2018.
A year of swings: Turbulence returned with a vengeance with stocks across the region seeing the most vicious price swings in more than two years, according to a gauge of 90-day volatility in the MSCI Asia Pacific Index.
Bears on parade: While the almost decade-long bull run in US equities is showing signs of life, gains at the start of the year in Asian markets proved less durable. Regional stocks as a whole fell as much as 24% from peak to trough this year, and major markets including Japan, Hong Kong and Shanghai fared even worse.
With many of these benchmarks sitting in emerging markets, the rout has sent the MSCI Emerging Markets Index about 24% lower since January.
Tariff tussle: Some of the year’s poor performance is due to the escalating trade conflict between China and the US, which has threatened to upend the global economy and disrupt supply chains across Asia. Exporters such as consumer goods trader Li & Fung in Hong Kong have been hit particularly hard, seeing more than 70% of its market value evaporate since May.
Technical difficulties: But one of the market’s biggest highlights was the capitulation of technology investors as the FAANG cohort stumbled. Apple and Amazon.com plummeted some 30% in the back half of the year. Internet stocks in Asia fared no better as Tencent Holdings plunged as much as 47% peak-to-trough. Chipmakers and hardware manufacturers suffered as plateauing smartphone demand remained an overhang for the industry through the year.
The China effect: Chinese investors were met with unwelcoming milestones. The Shanghai Composite Index is nearly 25% below where it started the year, making it the worst-performing major stock market in the world. 
The trade war wiped out about $2.4tn this year, while a deleveraging drive squeezed margin debt to just one-third of its peak in 2015.