Three of the world’s largest asset managers have lost at least $300 billion related to their U.S-based equities over the past week as volatility returned and bond yields spiked, creating a sell-off on Friday and Monday.
After swinging wildly Tuesday morning, dropping by as much as 567 points, the Dow Jones Industrial Average rose the same amount, 567 points, or 2.3%, to close at 24,912.77. A day prior, the Dow dropped 1,175 points, the largest single-day point decline ever.
Meanwhile, the Nasdaq Composite climbed 2.1% to 7,115.88 on Tuesday, and the S&P 500 rose 1.7% to 2,695.14.
BlackRock Inc. (BLK – Get Report) , which has about $5.7 trillion of global assets under management, saw its U.S.-based holdings lose about $104.4 billion over the past week, according to data compiled by FactSet Research Systems Inc. The firm’s Apple Inc. (AAPL – Get Report) position endured the largest loss, at around $2.6 billion.
Like Blackrock, The Vanguard Group’s Apple position took the biggest hit, losing $3.85 billion during the last week. Vanguard’s U.S. holdings lost approximately $153.7 billion over the past week, according to FactSet. The firm manages about $4.5 trillion in global assets.
Fidelity’s holdings in U.S.-based equities lost about $53.5 billion over the past week, according to FactSet data. For the firm with about $2.3 trillion of global assets under management, its position in Alphabet Inc. (GOOGL – Get Report) incurred the biggest loss at about $2.1 billion.
Importantly, Apple’s stock has dropped about 6.6% since Feb.1, when the tech giant reported a top- and bottom-line beats for the fiscal first quarter.
The large increase of market volatility will likely contribute to further outflows from systematic strategies in the days ahead, J.P. Morgan analyst Marko Kolanovic wrote in a Feb. 5 research note.
“However, we want to point out the massive divergence between strong market fundamentals and equity price action over the past few days,” said Kolanovic. “The large market decline over the past few days will likely draw fundamental investors.”
Ultimately, Kolanovic said, the market sell-off presented a buying opportunity.