Washington’s inaction regarding the debt ceiling had Wall Street in #purestruggle mode as it costed investors nearly three-quarters of a trillion dollars in this week — at least on paper. More after the jump…
(CNNMoney)–This week’s rout erased $700 billion worth of market capitalization, according to financial data company Wilshire, which owns the Wilshire 5000 Index. That index, which tracks every actively-traded stock in the United States, posted a loss of 4.2% for the week. The Dow fell 4.2% for the week, while the S&P declined 3.9%.
While paper losses and gains come and go as stocks fluctuate, this was the worst week for investors in more than a year.
It’s doubtful that most investors believe the U.S. will fail to raise the debt ceiling and default on its obligations, but Congress and the White House remain far away from reaching an agreement before the August 2 deadline.
“We can politically posture all we want, and saber rattle we want, but we gotta gotta come up with some compromise soon,” said Phil Orlando, market strategist with Federated Investors.
