Jeff Bezos and Elon Musk
Jeff Bezos and Elon Musk Image Credit: AP

Dubai: Imagine waking up to find out you've lost almost $10 billion overnight. Amazon founder Jeff Bezos would be able to commiserate, as he lost $9.8 billion on Wednesday at market close, as tracked by the Bloomberg Billionaires Index.

Also among the big losers were Tesla's Elon Musk and Facebook's Mark Zuckerberg. Bill Gates and Warren Buffet also lost to the tune of billions in one day.

Why the crash?

The crash in the stock prices came from speculation that the US Fed rates would see a major hike next week. A report on inflation at the wholesale level showed prices are still rising rapidly, with pressures building underneath the surface.

The Fed is taking aggressive action on interest rates to try and cool the hottest inflation in four decades. Tuesday's report on high prices jolted the market with signs that inflation is entering a more stubborn phase which could force aggressive action by the authority.

Share traders, analysts say, see a one-in-three chance the Federal Reserve may hike its benchmark rate by a full percentage point next week, quadruple the usual move. The central bank has already raised its benchmark interest rate four times this year, with the last two increases by three-quarters of a percentage point.

Stocks crash, slight gains

Tech stocks were the worst hit on Wednesday, with Meta skidding 9.4 per cent and chip giant Nvidia losing 9.5 per cent. 

Thursday has been slightly better for stocks, and these billionaires, as shares were mostly higher after a wobbly day of trading yielded modest gains on Wall Street.

Global stock markets were mixed on Thursday as the likelihood of a further jump in global borrowing costs, including a possible 100 basis point US rate hike next week, kept the bears on the prowl. Fitch now expects world GDP to grow by 2.4 per cent in 2022 - revised down by 0.5 percentage points - and by just 1.7 per cent in 2023, a cut of 1 percentage point.

- Inputs from agencies