One of our favorite market breadth indicators measures the percent of stocks in an index that are in a bear market, which we define as down at least 20% from their 200-day high (blue line, left axis, inverted in the charts below). By this measure the major Euro area MSCI stock indices are standing out like a soar thumb in that the percent of stocks in a bear market is accelerating higher and reaching levels near 30%. Contrast this with the MSCI Japan and MSCI USA in which the percent of stocks in a bear market remain at historically low levels of 17% and 8% respectively (last two charts below). We find this breadth measure interesting because even though the prices of these Euro area indices have declined in recent weeks, the decline is still less than 10% from the recent high. For example, MSCI France is only down 7.4% and MSCI Germany is only down 8.5%. This is another case then in which the average stock is performing much worse than the headline price index would suggest.