Investor wealth eroded

Amid the financial crisis in the US, Indian investors have witnessed an erosion of about Rs 2.3 lakh crore in their wealth in September, says a report.

Domestic equity market continued to be battered following negative global cues with the benchmark Nifty registering a fall of about 10 % in the last month.

"It is estimated that Rs 2.3 lakh crore of shareholders' wealth eroded in the background of the situation in the US financial markets," Crisil Research said in a report.

On the contrary, the fall in the US markets was lower with the S&P 500 and Dow Jones both declining by around nine % and six %, respectively, while emerging markets lost around 18 % during the month.

Pessimism in the financial markets following the filing for bankruptcy by Lehman Brothers, Merrill Lynch's sell-off, the bail out of AIG and perceived uncertainty around the US bail-out package added to investor fears.

Investor sentiment was also affected on news of the possibility of Fortis filing for bankruptcy, indicating problems in the European financial markets as well, the report added.

"The BSE Realty Index and the BSE Metal Index were the most severely affected during the month, dropping by 32 per cent and 25 %, respectively. Concerns over slowing demand in the real estate market due to a liquidity crunch and increased cost of funding weighed in on investor sentiment in the realty sector," Crisil Research Head-Equities Chetan Majithia said.