Huge loss: People walk past the site of the proposed Cheval Blanc Hotel of LVMH in Beverly Hills, California. The firm’s shares fell 5% in Paris, amid a broader decline that wiped out about US$30bil (RM137.3bil) from the European luxury sector. — AFP
PARIS: Bernard Arnault, the world’s richest person, had US$11.2bil (RM51.2bil) wiped from his fortune in one day over concerns that a softening US economy would dampen demand for luxury goods.
The founder of LVMH, whose offerings include Louis Vuitton handbags, Moet and Chandon champagne, and Christian Dior gowns, had seen his wealth balloon for most of 2023 as share prices of European luxury companies surged.
On Tuesday, though, he gave back some of those gains.
LVMH shares fell 5% in Paris, the most in more than a year, amid a broader decline that erased about US$30bil (RM137.3bil) from the European luxury sector.
Even with the selloff, the French billionaire still has a net worth of US$191.6bil (RM876.6bil), according to the Bloomberg Billionaires Index. He’s added US$29.5bil (RM135bil) so far this year.
The gap between the fortunes of Arnault and Tesla Inc’s Elon Musk, the world’s second-richest person, has shrunk to just US$11.4bil (RM52.2bil).
The rout came after a lengthy rally in LVMH’s share price, which is still up 23% for the year.
The MSCI Europe Textiles Apparel and Luxury Goods Index has surged 27%.
Attendees at a luxury conference in Paris organised by Morgan Stanley flagged a “relatively more subdued” performance in the United States, according to Edouard Aubin, an analyst at the investment bank.
Deutsche Bank AG analysts Matt Garland and Adam Cochrane said in a note that they expect investors to become more selective with European luxury stocks due to slowing growth in the United States. — Bloomberg
