Warren Buffett’s stock-holding empire has suffered a loss of at least $15bn in the midst of a global market sell-off.
Apple, Bank of America, and Mitsubishi all saw their stock values plummet on Monday.
This decline is despite the fact that Mr Buffett’s investment firm has built up significant cash reserves by cutting its stock market positions in recent months.
Berkshire Hathaway’s cash holdings reached a record of $277bn in the last quarter. This was boosted by an $76bn sale of stock.
As fears of an American recession increase, these efforts should have lessened the impact of Monday’s global stock market crash.
Berkshire Hathaway’s shares dropped by 3pc during the recent market crash, bringing its market capitalization down to $897bn.
The chaos caused a steep decline in its stakes in Japanese firms, including Tokyo giants Mitsui Marubeni and Sumitomo.
Berkshire Hathaway was also hit by the loss of hundreds of millions in value from American Express, Moody’s Financial Services and Kraft Heinz.
Calculations show that the investment company’s stakes in Apple have lost more than $7pc of their value since Apple’s share prices dropped by over 7pc.
Over the weekend, it was revealed that Berkshire Hathaway sold almost half its stock in Apple Inc.
Mr Buffett reduced the company’s Apple stake by another $50bn, to $84.2bn, in the second quarter 2024.
The 93-year old investor’s latest cash sale suggests he is becoming more wary of the US economy or overvalued stock market prices.
Mr Buffett – often referred to as the Sage Of Omaha because of his decades-long success in stock picking – reassured his shareholders that Apple is a long-term company investment.
Apple will be the largest investment for Berkshire Hathaway, according to Mr Buffett, speaking at Berkshire Hathaway’s annual meeting. “Unless something dramatic happens that changes our capital allocation strategy, Apple will be our biggest investment.”
Apple and members of the Magnificent 7 group of stocks, which includes Alphabet (Alphabet), Microsoft, Nvidia, and Tesla, suffered their biggest drops in history amid fears of a tech bubble burst.
players, however, see the fall as an opportunity to buy. Blue Whale, a fund of investment backed by Peter Hargreaves – billionaire cofounder of investor platform Hargreaves-Lansdown – took advantage the sell-off in the stock market to purchase shares in Nvidia.
Stephen Yiu told the Financial Times that the fund manager, Stephen Yiu, was “top-up [Nvidia].” The market has a narrative — with which we disagree — that AI applications are slowing down.
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