NEW YORK (Reuters) - The month-long slide in global stocks has wiped out at least $2 trillion in wealth, leaving investors few alternatives to preserve their holdings aside from bonds and money markets.
The Dow Jones industrial average <.DJI> is off 8.2 percent since mid-May and as ofTuesday's close had erased its gain for the year. The Nasdaq Composite Index <.IXIC> is off 12.75 percent from its high for the year on April 19 and the Standard & Poor's 500 Index <.SPX> has fallen by nearly 8 percent from its May peaks.
"It is essentially one consistent story worldwide, starting here in the U.S. There is a fear that the Fed's repeated commitment to limiting inflation demonstrates a willingness to risk economic activity," said Christopher Low, chief economist at FTN Financial in New York.
On Tuesday, Tokyo's Nikkei average booked its biggest one-day percentage fall in two years, tumbling 4.14 percent, wiping out more than 16.56 trillion yen ($145 billion) in market value from the Tokyo Stock Exchange's first section. It was the biggest one-day point drop since immediately after the September 11, 2001, attacks on New York and Washington.
In Europe, the FTSEurofirst 300 <.FTEU3> index of top European shares has fallen about 11 percent since May 11. The index finished at 1,238.5 points on Tuesday, its lowest closing level since November 30.
Since its year high hit in early May, the MSCI World Index <.MSCIWO> of global stocks has lost $1.9 trillion in market capitalization, nearly 12 percent of its value and more than the economic output of the United Kingdom.
The index compiled by MSCI Barra does not account for all global stocks, meaning the total amount of lost wealth is greater still.
The Dow Jones industrial average <.DJI> is off 8.2 percent since mid-May and as ofTuesday's close had erased its gain for the year. The Nasdaq Composite Index <.IXIC> is off 12.75 percent from its high for the year on April 19 and the Standard & Poor's 500 Index <.SPX> has fallen by nearly 8 percent from its May peaks.
"It is essentially one consistent story worldwide, starting here in the U.S. There is a fear that the Fed's repeated commitment to limiting inflation demonstrates a willingness to risk economic activity," said Christopher Low, chief economist at FTN Financial in New York.
On Tuesday, Tokyo's Nikkei average booked its biggest one-day percentage fall in two years, tumbling 4.14 percent, wiping out more than 16.56 trillion yen ($145 billion) in market value from the Tokyo Stock Exchange's first section. It was the biggest one-day point drop since immediately after the September 11, 2001, attacks on New York and Washington.
In Europe, the FTSEurofirst 300 <.FTEU3> index of top European shares has fallen about 11 percent since May 11. The index finished at 1,238.5 points on Tuesday, its lowest closing level since November 30.
Since its year high hit in early May, the MSCI World Index <.MSCIWO> of global stocks has lost $1.9 trillion in market capitalization, nearly 12 percent of its value and more than the economic output of the United Kingdom.
The index compiled by MSCI Barra does not account for all global stocks, meaning the total amount of lost wealth is greater still.
