South Africa’s richest people have seen a further R14 billion wiped from their collective net worth, as global markets suffered yet another meltdown overnight.
According to Forbes’ daily tracking of global billionaire wealth, the world’s richest people are suffering from the latest stock market crash that saw major indices fall over 10% on Thursday.
The crash followed comments from US president Donald Trump about travel restrictions to and from Europe because of the global Covid-19 coronavirus pandemic.
The announcement came as a shock to the market, where investors were expecting tighter measures to prevent the spread of the virus on US soil, but not a ban on travel.
All major global markets were down significantly on Friday morning.
- The UK’s FTSE was down 10.9%
- The JSE All Share was down 9.7%
- The Nasdaq was down 9.4%
- Germany’s DAX was hard hit at 12.3% lower, and the French CAC down 12.2%.
Asian markets also fell, with Japan’s Nikkei down another 6%, South Korea’s Kopsi down 3.4%, the Hang Seng 2.2% lower and the Shanghai composite down 1.8%.
As of Friday (13 March), over 134,800 cases of infection had been recorded globally, with almost 5,000 deaths. The majority of patients fully recover from the virus – with data tracking showing that only 59,450 cases of infection are active, with the balance – over 75,000 people – healthy again.
But as the virus spreads, and countries react in a bid to contain it, various economic industries are being heavily affected, from tourism to manufacturing.
Because of this, coronavirus panic selling has now hit almost every asset class, leaving investors with no place to hide, said Reuters analysts.
Some economies are trying to curb the losses by introducing stimulus packages, but they are not having the desired effect. The US Federal reserve announced a $500 billion stimulus package to counter market sentiments, but this was not enough to stop the Friday crash.
“There is no other way to put the sell off yesterday other than calling it a total bloodbath,” said Bianca Botes, treasury partner at Peregrine Treasury Solutions.
“It was red across the board, with some indices dropping over 10%. The NY Fed intervened in the early hours of yesterday evening, deploying QE of some $500 billion, minimising the losses … for a full 10 minutes, before they returned to their dismal state.
“This is now the second monetary easing strategy deployed by the US that has failed to achieve its objective,” she said.
Botes noted that the volatility index, which measures panic in the market, reached a new all-time high overnight, demonstrating just how pessimistic markets are on the ability to control the Covid-19 outbreak, as the infection spreads and the death toll rises.
“There is a sense of fear and panic,” said James Tao, an analyst at stockbroker Commsec in Sydney, speaking to Reuters.
“It’s one of those situations where there is so much uncertainty that no-one quite knows how to respond…if it’s fight or flight, many people are choosing flight at the moment.”
World’s richest taking pain
The bigger they are, the harder they fall has never been truer, as the world’s wealthiest people see billions of dollars wiped from their net worth due to the coronavirus market crash.
Earlier in the week – in what is being called Black Monday – the 20 richest people tracked by Forbes saw their collective wealth shrink by $78 billion (R1.28 trillion) overnight.
Following the latest crash, a further $77 billion (R1.27 trillion) has been wiped.
Tracking the trend of global billionaires, South Africa’s richest on the list also saw their fortunes slump.
After losing a combined $370 million on Monday (R6 billion), on Friday morning, losses amounted to $860 million – around R14.1 billion.
Luxury goods magnate Johann Rupert was again the biggest loser, having shed$486 million, or 9% of his net worth. However, minerals tycoon Patrice Motsepe saw the biggest chunk of his wealth crumble away, with a 10.5% reduction.
The table below outlines the losses:
|Johann Rupert||$4.9 billion||-$486 million||9.0%|
|Patrice Motsepe||$1.6 billion||-$187 million||-10.5%|
|Koos Bekker||$2.2 billion||-$88 million||-3.9%|
|Michiel le Roux||$1.0 billion||-$57 million||-5.5%|
|Nicky Oppenheimer||$7.5 billion||-$42 million||-0.6%|