How Downturn In The US Tech Stocks Impacted Jeff Bezos?
Since the markets were falling significantly as seen this week, the impact has also been felt on the tech heavyweight companies as well as on the top management of those companies. Amazon Inc. (NASDAQ: AMZN) witnessed the fall of 6.15% primarily because of the global pressures which are being witnessed on the equity markets. Apart from that, higher yields on the treasuries as well as escalating trade tensions between the US and China are also the primary drivers for the sell-off witnessed in the US markets.
The founder and chief executive officer or CEO of Amazon Inc., Jeff Bezos, saw $US9.1 billion getting wiped out from the net worth. This was witnessed because the share price of Amazon nosedived. As a result, the net worth of the CEO was reduced to $US145.2 billion. Overall, the Nasdaq index plunged 4.08%. However, apart from Amazon, there were other stocks too which were found joining the losing streak. The top shorts included Apple, Qualcomm, Tesla, Amazon, and Netflix in the US market. Then Microsoft Corporation (NASDAQ: MSFT) declined by 5.43%, Facebook (NASDAQ: FB) fell 4.13% and Google (NASDAQ: GOOGL) tumbled 4.63%. According to the market players, the FANG stocks are currently loaded with big valuations and hence, they need to come up with strong earnings so that these valuations can be justified.
However, the decline which was encountered by the technology stocks was not limited to the sector as well as economy. The downward momentum was also witnessed in the European markets and thus, the big personalities of Europe also saw their net worth declining. Bernard Arnault, the chief executive officer of LVMH witnessed a fall in its net worth by $US4.5 billion. This fall was witnessed because the share price of LVMH declined.
While the global economists have given their views that the strong downtrend in the US markets were because of higher yields as well as heightened tensions regarding the trade wars, Mr. Trump has someone to blame. According to the US President, the Federal Reserve’s decision of hiking the interest rates is the primary reason that the US markets are facing the negative impacts. However, the concerns of the Fed might be justified primarily because they need to check inflation as with strengthening economy and wage growth there is always the risk of higher inflation.
However, it can be said that the strong and strengthening outlook for the US economy has been made possible because of the Trump’s economic policies. As a result of these policies, the fundamentals are now strong which would aid the growth prospects of the country as a whole. The sell-off which has been witnessed in the US markets could be treated as the buying opportunity primarily because it can be considered a temporary situation. This is because the US economy is backed by the strong and strengthened fundamentals. If the Federal Reserve raises the interest rates in its December 2018 meeting, that would mark the fourth hike of the year. However, the market players as well as the global economists are expecting that the US needs to brace itself for the fourth hike.
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