World’s Richest Gain $12.7 Billion as Google Shares Drop
The 100 richest people on the planet added $12.7 billion to their collective net worth this week after worse-than-forecast corporate earnings in the U.S. wiped out most of the gains global stocks had posted earlier in the week.
Mexican Carlos Slim, 72, increased his fortune $1.8 billion after Telmex, the land-line unit of his Mexico City-based telecommunications company America Movil (AMXL) SAB, said on Wednesday it will begin offering high-speed Internet service without binding it with a phone line package. Slim remains the world’s richest person with a $77.6 billion fortune, according to the Bloomberg Billionaires Index.
“These disappointing earnings announcements are finally weighing on investors,” Jack Ablin, chief investment officer at BMO Harris Private Bank in Chicago, which oversees about $60 billion of assets, said in a phone interview.
U.S. stocks slid the most since June yesterday as General Electric Co. (GE), McDonald’s Corp. (MCD) and Microsoft Corp. (MSFT) posted results that missed estimates and euro-area leaders failed to discuss aid for Spain at a European Union summit in Brussels. The slide in equities was tempered by housing starts in the U.S., which surged 15 percent in September to the highest level in four years.
The Standard & Poor’s 500 Index (SPY) gained 0.32 percent during the week to close at 1433.19 in New York. The Stoxx Europe 600 Index rose 1.73 percent, closing at 274.08.
Microsoft co-founder Bill Gates, 56, is the second-richest person on Earth with $64 billion. The world’s largest software maker announced on Thursday that net income was 53 cents a share in the first fiscal quarter, missing the 56-cent average estimate of analysts polled by Bloomberg. The Redmond, Washington-based company cited declining sales of Windows, its flagship operating system, as the main reason for the shortfall.
Europe’s richest man, Amancio Ortega, is No. 3 on the index with a net worth of $52.4 billion, $4.6 billion ahead of Warren Buffett. The 76-year-old founder of Inditex SA (ITX), the world’s largest clothing retailer and owner of the Zara clothing chain, has gained more than $17 billion this year.
The fortunes of Google Inc. (GOOG) founders Sergey Brin, 39, and Larry Page, 39, plummeted a combined $3.2 billion after the Mountain View, California-based company’s third-quarter results were prematurely released Thursday. The blunder triggered an 11 percent drop in Google shares and erased more than $22 billion from its market capitalization in the minutes before trading was halted.
“It’s a human error. It’s not something I blame the company for necessarily, but it undermines investor confidence a little bit,” said Ablin.
Google’s profit and sales are under pressure as the operator of the world’s largest search engine struggles to wring advertising dollars from the growing number of people who surf the Web on tablets and smartphones.
Page and Brin rank 26th and 27th in the world with net worths of almost $21 billion.
The Bloomberg Billionaires Index takes measure of the world’s wealthiest people based on market and economic changes and Bloomberg News reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York. The valuations are listed in U.S. dollars.
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