With Markets Falling, How Can the Big Personalities be Left Out?

  • Oct 12, 2018 AEDT
  • Team Kalkine
With Markets Falling, How Can the Big Personalities be Left Out?

The equity markets are down globally and hence, the impact was also felt on the net worth of the founders of these companies. The increased yields coupled with the report from the International Monetary Fund or IMF have impacted the net worth of big tech companies. The net worth of Amazon Inc.’s (NASDAQ: AMZN) founder, Jeff Bezos has also witnessed a downfall as the stock price of its company nosedived. Not only Amazon, but the strong downtrend was also witnessed in the FAANG stocks as they were being shorted by the market participants in order to hedge the portfolios because of the sell-off in the broader markets. However, it is expected that when the broader markets start to recover, the market players would be buying the technology giants and, as a result, the stock prices of the technology companies might witness a strong uptrend.

However, the strong downtrend was witnessed in the Australian markets primarily because of the global sell-off. However, the IMF report also stated that the Australian economy is likely to witness the impact of the trade tensions. The strong downtrend was also visible in the technology stocks and, as a result, founders of these tech companies saw their net worth decline. On 11 October 2018, Afterpay Touch (ASX: APT) ended the day lower at A$13.76 which implies the decline of 11.1%. However, WiseTech Global (ASX: WTC) recorded the decline of 10.5% and stood at A$16.43 and its owner witnessed the fall of $296 million. The net worth of the owner of Afterpay, Nick Molnar, declined by $38 million. 

Until the impacts of the higher yields fade, the emerging economies would continue to be impacted by the macro factors. The treasurer of Australia is also of the view that the economy is not in a position witness stringent rules regarding the borrowing capacity of the businesses. If implemented, it might be a hurdle in the long-term growth. The Australian markets witnessed robust momentum in August 2018 primarily because the investors continue to make deployments. However, now the dark clouds are hovering over the Australian markets. The technology stocks got impacted by the global downturn. The technology sector in the United States also tumbled reflecting that the short sellers have been very active lately.

The market participants were expecting this type correction and hence this could be treated as the buying opportunity. The increased valuations of the tech stocks have started to weigh on the investors’ sentiments as they were in the dicey position that whether or not these companies would be able to meet the expectations of the broader markets in regard to the earnings. Moving forward, it is widely expected that the wealthy persons, which have been impacted by the declining stock prices of their companies, might see an increase in their net worth if the market players believe that this correction is temporary and that it needs to be considered very good buying opportunity. The recent fall in the Australian markets might help the investors in selecting the stocks which have strong fundamentals and have the potential to witness strong growth momentum.

Dividend Stocks To Buy

The Income available from dividends remains attractive for many investors.

We take a look at the best yields on the market and assess what they say about a company’s prospect.

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