World's richest lose $134bn as US recession fears spark Wall Street rout

The sell-off was triggered by investor concerns over weak jobs data and manufacturing activity

Trading on the floor of the New York Stock Exchange. The tech-heavy Nasdaq Composite fell by 2.4 per cent on Friday, bringing its losses to about 10 per cent since its record close on July 10, confirmShow more

The world's 500 wealthiest people lost a combined $134 billion as fears of another recession in the US led to a stock market sell-off on worries over jobs data and weak manufacturing activity around the world.

Technology players suffered the worst, with Amazon founder Jeff Bezos leading the decline as he shed about $15 billion from his fortune for his third-worst loss, according to both the Bloomberg Billionaires Index and Forbes Real Time Billionaires list, after the world's biggest e-commerce platform retreated 8.8 per cent on Friday.

Oracle boss Larry Ellison lost about $5 billion as his company's shares settled 3 per cent lower, while Alphabet co-founders Sergey Brin and Larry Page's wealth each retreated more than $3 billion, as the Google parent company gave up 2.35 per cent.

Meta Platforms boss Mark Zuckerberg lost around $3 billion as the Facebook owner's stock slid nearly 2 per cent. Dell Technologies founder Michael Dell also lost around $3 billion as his company plunged 5.7 per cent.

Tesla co-founder and X owner Elon Musk, the world's wealthiest person, lost as much as $6.57 billion as shares in the electric vehicle maker declined more than 4.2 per cent.

LVMH chief executive Bernard Arnault, former Microsoft chief executives Bill Gates and Steve Ballmer, and Berkshire Hathaway chairman Warren Buffet, who make up the rest of the world's 10 wealthiest, collectively lost more than $7 billion.

The market selloff started after the US Labour Department reported a softening employment market, with the world's largest economy adding just 114,000 jobs last month, down from 179,000 in June.

That was well below economists' expectations of 185,000. Meanwhile, the unemployment rate unexpectedly rose 4.3 per cent, its highest level since October 2021.

"Global financial markets are in a state of heightened anxiety, with key indices experiencing significant declines and investor sentiment shifting rapidly," said Nigel Green, chief executive of financial advisory firm deVere Group.

The report dragged the tech-heavy Nasdaq Composite down 2.4 per cent, bringing its losses to about 10 per cent since its record close on July 10, confirming it was in correction territory. An index or stock is in a correction when it closes 10 per cent or more below its latest high.

The S&P 500, meanwhile, shed 1.8 per cent for its worst jobs day reaction in nearly two years, and has lost around 6 per cent since its last record close. The Dow Jones Industrial Average fell more than 1.5 per cent.

Adding to their woes are concerns over the health of manufacturing activity across Asia, Europe, the US and, in particular, China, the world's second-largest economy.

A US manufacturing report on Thursday showed activity dropped to an eight-month low, sparking fears the Federal Reserve may be late in cutting interest rates. The US central bank left rates unchanged on Wednesday and hinted that a widely-anticipated rate cut in September is "on the table".

For the week, both the S&P 500 and Dow retreated 2.1 per cent, and the Nasdaq lost 3.4 per cent. Still, they remain in the black year-to-date, having gained 12.1 per cent, 5.4 per cent and 11.8 per cent, respectively.

“The shifts in global markets have prompted investors to reevaluate their strategies in light of the US Federal Reserve’s September rate cut plan," Mr Green said.

“With manufacturing and jobs data signaling potential recessionary trends, there’s growing concern that the Fed may be lagging in its response, potentially cutting rates too late to avert a serious slowdown."

In Europe, London's FTSE 100 declined 1.3 per cent, hit by fears on the US economy. Paris' CAC 40 shed 1.6 per cent and Frankfurt's DAX dropped 2.3 per cent.

Earlier in Asia, Tokyo's Nikkei 225 bore the brunt of the stock market rout, diving 5.8 per cent as the yen strengthened after the Bank of Japan raised interest rates to its highest levels in 15 years on Wednesday.

Hong Kong's Hang Seng Index dropped 2.1 per cent, while the Shanghai Composite lost 0.9 per cent, despite concerns on the Chinese economy.

In commodities, oil prices settled lower and slid to its lowest levels in seven months on economic worries and as demand concerns offset fears of a supply disruption caused by geopolitical tension in the Middle East.

Brent plunged 3.41 per cent to at $76.81 a barrel, while West Texas Intermediate dove 3.66 per cent to $73.52 a barrel.

Gold, meanwhile, slid on profit-taking. The precious metal retreated nearly 0.5 per cent to $2,469.80 per ounce.