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Forbes billionaire list: Trump loses $1bn as elite club gets 233 new members

Post-US election boom in stock markets and continued rise in oil price help bring global total of billionaires to nearly 2,300 individuals

US president Donald Trumps fortune has fallen by about $1bn to $3.5bn over the past year, as measured by Forbes magazine in its annual list of the worlds billionaires.

However, overall it has been a good 12 months for the worlds wealthiest individuals, with a record 233 moving into the billionaire bracket, taking the global number of people with nine-zero fortunes to 2,043 the most in the 31-year history of the list.

The billionaires in Forbes list are worth a combined $7.67tn (6.18tn) more than three times the UKs annual gross domestic product (GDP).

Kerry Dolan, co-editor of the Forbes billionaires list, published on Monday, said the gains are mostly the result of booming stock markets and the rising price of oil over the past 12 months.

Number of billionaires

Global markets have hit record highs due to the so-called Trump bump following Trumps election, with the Dow Jones soaring above 20,000 points for the first time and the UKs FTSE 100 closing at a record 7,415 points last week.

The fall in Trumps net worth is due to a drop in the value of office space in Midtown Manhattan, where the president owns about 10 buildings. Forbes said Trump had fallen from the worlds 324th-richest person to 544th.

Forty percent of Donald Trumps fortune is tied up in Trump Tower and eight buildings within one mile of it, Forbes said. Lately, the neighbourhood has been struggling (relatively speaking).

Trump has refused to publish his tax returns to show the true scale of his wealth, but during the campaign he claimed he was worth in excess of $10bn.

Dolan said that in previous years the real estate tycoon had challenged Forbes for underestimating his fortune. We contact everyone we can to give them the opportunity for feedback. Over the last 31 years we have been compiling this list Trump has given us a lot of feedback, believe me, You guys are too low I am worth far more than you say, she said. He didnt call back to dispute our estimate. I would hope that running the country is more important to him right now than Forbess value of his net worth.

The richest person in the world remains Microsoft founder Bill Gates, who saw his fortune grow by $11bn to $86bn. He is followed by investor Warren Buffett, and Amazon founder Jeff Bezos, who was this years biggest gainer with a $27.6bn increase in his fortune to $72.8bn.

Top 10 richest

The US accounts for the biggest population of billionaires with 565, up 25 on last year. But China is catching up with 319 billionaires, and a further 68 if Hong Kong and Macau are included. Germany is third with 114 billionaires.

The number of UK billionaires increased from 50 to 54, with new entrants including Philip Day, the man behind Edinburgh Woollen Mill, and Simon Nixon, the co-founder of moneysupermarket.com.

The richest people in the UK are the Hinduja family, who control a conglomerate of businesses including cars and banks and are worth $15.4bn. Property and internet investors David and Simon Reuben come second with a $15.3bn fortune. The third richest, and among the biggest gainer, is Jim Ratcliffe the founder and chairman of chemicals group Ineos.

UK richest

Among the biggest British losers is Sports Direct founder Mike Ashley whose fortune dropped by 25% to $2.6bn. His wealth, which is largely held in Sports Direct shares, has roughly halved over the past two years as shares collapsed following the Guardian expos of Victorian workhouse-style conditions in its distribution warehouses.

Sir Philip Green and his wife, Tina, the owners of Arcadia, which owns Topshop and once owned BHS, also lost just over $1bn, with their fortune slumping to $4.8bn. They fell more than 100 places to 339th.

Oxfam said the creation of so many new billionaires in one year was a sign of economic sickness rather than health.

Our warped economic model leads to more unequal societies that trap millions of people in poverty – it allows an elite group to accrue extreme wealth while one in nine people go to bed hungry every night, Max Lawson, Oxfams head of inequality policy, said. We need to build a more human economy where the super-rich pay their fair share of tax, workers earn a living wage, and governments invest in decent healthcare and education to give everyone a good start in life.

The number of women on the list increased to 227, from 202 in 2016. A record 56 of the women are self-made billionaires the highest ever. All but one of the 15 newly self-made female billionaires came from the Asia-Pacfic region, including Vietnams first self-made female billionaire Nguyen Thi Phuong Thao who took her budget airline VietJet Air public last month.

Yoshiko Shinohara, who started her temp agency in her one-bedroom Tokyo apartment, became Japans first self-made female billionaire. She enters the list due to a 50% surge in the stock price of her company Temp Holdings, which is designed to get more women into the workforce.

The richest woman on the list is Frances Liliane Bettencourt, who inherited a stake in LOreal from her father. Shes worth $39.5bn.

There are just 10 black people on the list, a drop of two from last year. The richest black person is Nigerian cement tycoon Aliko Dangote with an estimated fortune of $12.2bn. There are only three black women on the list, including Oprah Winfrey who has a $3bn fortune.

Read more: https://www.theguardian.com/business/2017/mar/20/forbes-billionaire-list-trump-loses-1bn-as-elite-club-welcomes-233-new-members


US Federal Reserve raises interest rates to 1% in bid to hold off inflation

Fed chair says US economy in strong health as she announces third rate rise since 2008 and the first of several expected this yearJanet Yellen discusses interest rate rise live updates

The US Federal Reserve has sought to head off rising inflation with a third interest rate rise since the 2008 financial crash and the second in three months, taking the base rate from 0.75% to 1%.

The central bank set aside concerns about the impact of higher interest rates on consumer spending to confirm analyst projections that it is prepared to increase rates several times this year to keep a lid on inflation as it rises above its 2% target level.

The Feds chair, Janet Yellen, said a wide range of indicators showed the US economy was in rude health, allowing its interest rate setting committee to push rates back towards historically normal levels. Policymakers voted nine to one to raise rates.

Speaking after the decision, Yellen said she had met Donald Trumps treasury secretary, Steven Mnuchin, a couple of times but had only been introduced to the president himself.

I fully expect to have a strong relationship with secretary Mnuchin, she said. We had good discussions about the economy, about regulatory objectives, the work of the FSOC [Financial Stability Oversight Council] global economic developments, and I look forward to continuing to work with him. She said she had had a very brief meeting with Trump and appreciated that as well.

Earlier in the day the Department of Commerce said retail sales had inched up by 0.1% in February, and that they had been better than it had previously estimated in January.

US interest rates

The Department of Labor said consumer prices were 2.7% higher in February than a year earlier. After excluding the costs of food and energy, inflation was 2.2%. A housing market index from the National Association of Home Builders also surged to its highest level since 2005.

US stock markets moved up on the news, rising 90 points in the minutes after the decision, and US crude rose 2%. The increases were modest following Yellens signals in December that interest rates were on an upward path. Investors were also caught out by Yellens bullish comments in the wake of the announcement and by projections showing that 11 of her 17 policymaking colleagues saw borrowing costs rising another three times in 2017.

Dennis de Jong, the managing director of the currency trader UFX.com, said: Given the bloating effect Donald Trumps presidency has had on US inflation, it would have been more of a surprise had Fed Chair Janet Yellen not announced a rate hike at todays Federal Reserve meeting.

Trumps grand plans for American infrastructure spending have signalled an about-turn for US economic policy after just one rate increase in ten years, weve now seen two in the space of three months, and plenty more are expected for 2017.

This all spells bad news for US borrowers, who will likely have to foot a larger bill over the coming months. With at least three more hikes on the cards by the end of the year, todays news could hit many where it hurts the most the pocket.

US CPI

Some economists argue that weak wages and productivity growth in the US will limit the Feds rate increases to a handful before reaching a peak at around 2%.

Gus Faucher, the deputy chief economist at the stockbroker PNC, said: I think the concern, in terms of why the Fed is raising rates now, is that inflation is picking up. The unemployment rate is 4.7% and thats putting upward pressure on prices.

He told the Guardian economic forces were acting against a return to interest rate levels of 4-5% seen before the 2008 crash.

We have slower labor force growth because of the ageing of the baby boomers, [and thus] slower productivity growth in terms of output per worker, he said. That has reduced the potential for long-run growth, its reduced inflationary pressures, and I think rates in the future will be lower than they have been in the past.

US retail sales

Faucher also said further interest rate rises could dent consumer spending, which has come to rely on cheap loans.

I do think eventually that higher interest rates are going to have an impact on rates for car loans, so that may be a problem for automakers. It may be a problem for big-ticket durable items, home appliances, stuff like that. There is a ceiling on those effects, though, and Faucher doesnt think they will affect home loans.

There isnt much bleed over into mortgage rates; its mostly the short-term borrowers, he said.

Fed policymakers are known to be concerned that the tax cuts and extra government spending Trump has demanded could overheat the economy and lead to a deep recession. Should that happen, the Fed will want to have substantial interest rates in place.

Read more: https://www.theguardian.com/business/2017/mar/15/us-federal-reserve-raises-interest-rates-to-1


US stocks hit record highs as gains continue following Trump victory

Dow Jones surpassed 19,000 for first time this week, as investors expect lower corporate taxes under Trump

US stocks notched fresh records, capping a week when the Dow Jones Industrial Average breached 19,000 for the first time, as investors continued to bet on a pickup in economic growth and rising corporate profits.

The gains were modest but broad, with utilities rising the most, up 1.4%.

US market indexes have been rising since the presidential election and this is the third consecutive week of gains as investors anticipate reduced corporate taxation and regulation, as well as greater infrastructure spending, under a Trump administration.

Since the election on 8 November, the Dow industrials are up 4.5%. If the markets hold, they will be on track to end the year with 9.9% gains their best since 2013.

Analysts say the markets are rising on recent signs of a pickup in growth in several other major economies around the world.

We havent had a synchronized bounce in growth across the globe ever in this recovery, Jim Paulsen, chief investment strategist for Wells Capital Management, told the Associated Press.

This is the first time youre getting all the economic boats going north at the same time, and I think stock markets are reflecting that.

The stock market is benefitting from an exodus of cash from government bonds as well as real estate and gold even as investors anticipate interest rates rises next month.

The surprising thing after the election was not that we rallied to this level, it was the speed at which we got there, Scott Wren, senior global equity strategist at Wells Fargo Investment Institute told the Wall Street Journal.

Wren added that there is a lot of enthusiasm out there for Trumps policies, including spending on infrastructure, relaxing regulation for big banks and cutting taxes.

Stock trading closed at 1pm eastern time. Trading was relatively quiet as investors returned from the Thanksgiving holiday.

Read more: https://www.theguardian.com/business/2016/nov/25/us-stocks-dow-jones-record-trump


UK loses triple-A credit rating after Brexit vote

Standard & Poors issues downgrade and pound hits 31-year low despite chancellors attempts to soothe markets

The UK has been stripped of its last AAA rating as credit agency Standard & Poors warned of the economic, fiscal and constitutional risks the country now faces as a result of the EU referendum result.

The two-notch downgrade came with a warning that S&P could slash its rating again. It described the result of the vote as a seminal event that would lead to a less predictable stable and effective policy framework in the UK.

The agency added that the vote to remain in Scotland and Northern Ireland creates wider constitutional issues for the country as a whole.

S&P was the last of the big three ratings agencies to have a blue-chip rating on the UKs credit-worthiness. Moodys, which stripped the UK of its top notch rating amid the austerity cuts of 2013, said last week it might further cut its view of the UK.

Rating agency moves have the potential to make it more expensive for the government to borrow.

The S&P move came after another torrid day on the financial markets. The pound hit fresh 31-year lows and 40bn was wiped off the value of the UKs biggest companies on Monday, despite efforts by George Osborne to quell investors concerns about the economic and political ramifications of the Brexit vote.

After three days of silence, the chancellor made a statement on Monday morning to try to calm the markets. However, sterling remained under sustained pressure on the foreign exchange markets as economists slashed their forecasts for UK economic growth. Wall Street was also weaker while continental bourses sold off sharply after Fridays record $2tn of losses on global stock markets.

Expectations are mounting that the Bank of England will cut interest rates possibly to zero from their historic low 0.5% to stimulate the economy, and yields on government bonds fell below 1% for the first time, which could spell cheaper mortgage rates.

In a live broadcast just after 7am, as dealers in London braced for another day of turmoil, Osborne insisted: Our economy is about as strong as it could be to confront the challenge our country now faces.

But moderate losses on the FTSE 100quickly deepened and at one point sterling was down 3.5% against the dollar, at $1.3122, its lowest level since 1985. Against the euro, the pound was down 2.4% at 1.19.

Speaking at the World Economic Forum in China, Nouriel Roubini, economist at New York University, described Brexit as a major significant financial shock that would create a whole bunch of economic, financial, political and also geopolitical uncertainties.

By the end of trading, the FTSE 100 index was down 2.6%, or 156.5 points, and below 6,000. The FTSE 250, the next tier of companies and more closely tied to the UK economy, was down 7%, coming on top of a 7% fall on Friday.

Its been another dramatic day of trading on the UK stock market, said Laith Khalaf, senior analyst at the financial firm Hargreaves Lansdown.

Companies likely to be impacted by a Brexit-induced recession were hit hard. In two days, about 40bn has been wiped off the value of banking stocks and 8bn off housebuilders. At one point, shares in the bailed-out Royal Bank of Scotland plunged 25%, while housebuilders such as Persimmon and Taylor Wimpey have lost more than 40% in just two trading days.

Michael Hewson, chief market analyst at CMC Markets, said while Osbornes statement had been measured his comments were unable to prevent the feeling that UK politics remains in a state of paralysis, with no clear contingencies in place to deal with the fallout of a leave vote.

The biggest faller in the FTSE 100 was short-haul airline easyjet, which plunged by 22% after warning that wary consumers would now rethink their travel plans. Exchange rate movements, the carrier added, would add 25m to costs.

Another profit warning came from the London-focused estate agent Foxtons. Its shares dived 25% after it said Brexit would hit sales for the rest of the year. Shares in so-called challenger banks such as Virgin Money were also pummelled.

Osborne spoke after it emerged that the Bank of England governor, Mark Carney, had cancelled a trip to Portugal to remain in the UK to oversee any response from Threadneedle Street.

The Banks financial policy committee, set in the aftermath of the financial crisis to look for threats to stability, will meet on Tuesday, when the Bank of England will again offer emergency loans to banks as part of its Brexit planning.

The fallout from the vote is being felt around the world. Italys main index fell 4%, extending Fridays record losses of 12.5%. In Germany and France there were losses of 3%. At the time of the London close, on Wall Street the main share indices were all down more than 1%.

The chancellor may have taken some comfort from the fall in yields on 10-year government bonds. Yields on these gilts, which move inversely to prices, fell below 1% for the first time. This fall in gilt yields will keep government borrowing costs down and lead to lower mortgage rates. However, they also mean pension companies have started cutting the amount paid to the newly retired.

Osborne refused to repeat his pre-vote warning of a Brexit recession, saying only that the economy would face adjustments. But analysts started to cut their forecasts for UK growth. Goldman Sachs, forecasts just 0.2% growth in 2017, down from 2% predicted previously.

The consultancy Oxford Economics said interest rates could be slashed to 0% within weeks. Morgan Stanley analysts said European and UK stocks would fall up to 10% over the coming months and sterling would fall to between $1.25 and $1.30.

Much of the markets focus has been on the pound, particularly after the speculator George Soros, who made $1bn when sterling fell out of the exchange rate mechanism in 1992, had warned of a black Friday in the event of Brexit. His spokesman stressed that he had not bet against the pound last week.

George Soros did not speculate against sterling while he was arguing for Britain to remain in the European Union, the spokesman told Reuters. However, because of his generally bearish outlook on world markets, Mr Soros did profit from other investments

Read more: https://www.theguardian.com/business/2016/jun/27/property-and-financial-shares-slide-as-referendum-fallout-hits-stock-markets


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