Global shares drop as Fed, ECB awaited

US stocks fell on Tuesday with traders' sights set again on Wednesday's Federal Reserve statement on the economy and a possible new round of stimulus.

For the month of July, the Dow rose 1 percent, while the S&P 500 climbed 1.3 percent and the Nasdaq added 0.2 percent. After seven months, the S&P 500 has gained nearly 10 percent for the year, despite a slowing world economy.

In Tuesday's session, the Dow Jones industrial average fell 64.33 points, or 0.49 percent, to 13,008.68 at the close. The S&P 500 Index dropped 5.98 points, or 0.43 percent, to 1,379.32. The Nasdaq Composite lost 6.32 points, or 0.21 percent, to 2,939.52.

European shares suffered their biggest intraday fall in more than a week, hit by weak bank results and fresh doubts over whether the European Central Bank (ECB) could agree on concrete measures to tackle Europe's sovereign debt crisis.

The FTSEurofirst 300 index closed down 0.9 percent to 1,063.35 points - its worst one-day fall since a 2.4 percent decline on July 23.

In Asia, Nikkei share average logged its worst July performance in five years on concerns about a deepening euro zone crisis and slowing global growth, although month-end buying from fund managers lifted the benchmark to a one-week closing high today. The benchmark lost 3.5 percent this month.

The Nikkei advanced 0.7 percent to 8,695.06, breaking above 8,687.93, the 50 percent retracement of its rally from June 4 to July 4. The broader Topix put on 0.6 percent to 736.31.