Tuesday’s crash came after a long rally in LVMH’s share price.
Washington:
The world’s richest man, Bernard Arnault, lost $11.2 billion in one day amid fears that a slowing US economy would reduce demand for luxury goods.
The founder of LVMH – whose gifts include Louis Vuitton handbags, Moët & Chandon champagne and Christian Dior gowns – sees wealth ballooning to 2023 as share prices rise for European luxury companies.
On Tuesday, he returned some of those findings. LVMH shares fell 5% in Paris – the most in more than a year – as about $30 billion was lost from the European luxury sector.
The French billionaire had a net worth of $191.6 billion at the time of the sale, according to the Bloomberg Billionaires Index. It added $29.5 billion this year.
The gap between Arnold and Tesla Inc’s Elon Musk has narrowed to $11.4 billion for the world’s second-richest person.
Tuesday’s crash came after a long rally in LVMH’s share price, which is still up 23 percent for the year. The MSCI Europe Textiles, Apparel and Luxury Goods Index rose 27 percent.
Attendees at Morgan Stanley’s luxury conference in Paris showed a “relatively subdued” showing in the U.S., said Edward Aubin, an analyst at the investment bank.
Deutsche Bank AG analysts Matt Garland and Adam Kochan said in a note that they expect investors to be more selective about luxury stocks in Europe and that slowing growth in the US is a concern.
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