World’s richest man loses US$11 billion after LVMH stock rout

BERNARD Arnault, the world’s richest person, had US$11.2 billion wiped from his fortune in one day over concerns that a softening US economy will dampen demand for luxury goods.

The founder of LVMH – whose offerings include Louis Vuitton handbags, Moet & 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 (May 23), he gave back some of those gains. LVMH shares fell 5 per cent in Paris – the most in more than a year – amid a broader decline that erased about US$30 billion from the European luxury sector.

Even with the selloff, the French billionaire still has a net worth of US$191.6 billion, according to the Bloomberg Billionaires Index. He’s added US$29.5 billion so far this year.

The gap between the fortunes of Arnault and Tesla’s Elon Musk, the world’s second-richest person, has shrunk to just US$11.4 billion.

Tuesday’s rout came after a lengthy rally in LVMH’s share price, which is still up 23 per cent for the year. The MSCI Europe Textiles Apparel & Luxury Goods Index has surged 27 per cent.

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Attendees at a luxury conference in Paris organised by Morgan Stanley flagged a “relatively more subdued” performance in the US, according to Edouard Aubin, an analyst at the investment bank.

Deutsche Bank analysts Matt Garland and Adam Cochrane said in a note that they expect investors to become more selective with European luxury stocks, with slowing growth in the US a concern. BLOOMBERG