(Updates with U.S. midday trading)
* Global recovery fears send stocks tumbling; boosts bonds
* U.S. housing data falls short of bearish projections
* Euro hits six-week low vs dlr, nine-year trough vs yen
By Al Yoon
NEW YORK, Aug 24 (Reuters) - World stocks fell to one-month lows on Tuesday and the yen hit a 15-year high as dismal U.S. housing data added to fears the global economic recovery would fizzle out.
Pessimism about global growth has grown infectious in recent weeks after lackluster employment and consumer reports. Fears were affirmed on Tuesday by a report showing U.S. existing house sales slid way more than expected after the government ended homebuyer tax credits. [nLDE67N1O6].
Federal Reserve Bank of Chicago President Charles Evans said he was concerned about the strength of recovery in the U.S., but saw a return to recession as unlikely.
Earlier, a Bank of England policymaker said the UK risked sliding back into recession, adding to broader risk aversion. The comments drove 10-year British government bond yields near record lows and 30-year German Bund yields to all-time lows as investors sought safety. Bond yields move inversely to prices.
"The wheels are coming off the recovery," said Keith Springer, president of Capital Financial Advisory Services in Sacramento, California.
In New York, the Dow Jones industrial average <.DJI> slumped 83.55 points, or 0.82 percent, to 10,090.86, the lowest in more than a month. The Standard & Poor's 500 Index <.SPX> declined 9.85 points, or 0.92 percent, to 1,057.51 and the Nasdaq Composite Index <.IXIC> slid 21.91 points, or 1.01 percent, to 2,137.72.
The bearish tone deepened after the U.S. housing report. It showed July sales of existing homes dropped a record 27.2 percent from June to an annual rate of 3.83 million units. Analysts polled by Reuters expected sales would fall 12 percent to 4.7 million.
"The problem that pushed us into recession to some degree still remains: There's still imbalance in the housing market, said Zach Pandl, an economist at Nomura Securities International in New York. "Even after four years of declines, housing remains the key threat to the (economic) recovery."
Major European shares <.FTEU3> shed more than 1.6 percent, and the MSCI world equity index <.MIWD00000PUS> fell 1 percent to its lowest since July 22. The Thomson Reuters global stock index <.TRXFLDGLPU> was 0.9 percent lower.
Japan's Nikkei average <.N225> fell 1.3 percent, dipping below the closely watched 9,000 mark for the first time in 15 months, pressured by selling from hedge funds and foreigners.
The Nikkei index has shed nearly 15 percent so far this year, compared to a 2.6 percent fall in the MSCI Asia ex-Japan index. The 9,000-9,100 range had been strong support for the benchmark Nikkei since last year.
BUOYANT YEN
The yen reached a new 15-year high against the dollar and a nine-year peak against the euro on fears the global economy was slowing. The yen was also helped as Japanese Finance Minister Yoshihiko Noda resisted market pressure to comment on currency intervention. [ID:nTOE67N066]
The dollar
"Unless the Japanese step in with something more definitive, we will see speculative accounts drive the dollar/yen down to 80 yen," said Paul Robson, RBS Global Banking currency strategist. "That will hurt the Japanese economy pretty hard, unless they do something more on the fiscal side or resort to more quantitative easing."
Against the dollar, the euro rose 0.15 percent to $1.2677m rebounding after the U.S. housing report.
The scramble for less risky assets sent the 10-year and
30-year German Bund yields
Benchmark 10-year U.S. government yields declined 0.07
percentage point on the day to 2.53 percent
"The market is looking for any sign of weakness... There's so much bearishness around the U.S. economy at the moment and that's casting a pall over equity markets and helping government bonds," said Nick Stamenkovic, strategist at RIA Capital Markets.
In commodities, U.S. light sweet crude oil
Gold
(Additional reporting by Emelia Sithole-Matarise, William James and Anirban Nag in London and Rodrigo Campos in New York; Editing by Andrew Hay)