$3 Trillion Evaporates from Global Markets as Stock Indices Plummet
August 6, 2024, 1:47 am

Money Market

$3 Trillion Evaporates from Global Markets as Stock Indices Plummet

The sharp decline in global markets reflects a state of financial panic, raising fears of a repeat of the 2008 global financial crisis.

International financial markets have wiped out more than $3 trillion in market value due to massive losses at the start of the trading week. The fear index soared to its highest levels in four years, surpassing 120% compared to last Friday.

The Nikkei 225 index in Japan recorded the largest drop, with its worst daily performance since 1987, resulting in a loss of approximately $620 billion in market value, according to estimates by "Al Arabiya Business." This does not include all Japanese stocks, which also suffered significant losses.

Additionally, the MSCI Emerging Markets Index incurred losses of $504 billion, while the Stoxx 600 European Index saw losses exceeding $300 billion.

As American markets opened with losses, the extent of the losses expanded significantly, with American markets adding over $2 trillion in losses. The market value of the world's top 9143 companies dropped to $101.8 trillion, down from $103.8 trillion at the start of American market trading.

Estimates by "Al Arabiya Business" do not cover all global markets, so the figure could increase. What is certain is that the current stock losses are the greatest since the COVID-19 pandemic and could approach levels seen during the 2008 global financial crisis.

In this context, Michel Salibi, Senior Market Analyst at FXPro, stated that international financial markets are experiencing a state of panic and severe liquidation of stocks and cryptocurrencies, attributed to two main reasons.

In an interview with "Al Arabiya Business," he said there is growing concern over "carry trade" operations since last week following an interest rate hike in Japan, despite the yen falling to levels of 143 yen to the dollar.

He explained that financial markets had reached high levels, prompting investors to withdraw and turn to the US Treasury bond market, especially ten-year bonds. He noted that American employment data exacerbated market fears last Friday.

He added, "I do not see any signs of an economic recession or an urgent intervention by the US Federal Reserve to lower interest rates, and there are indications of a potential 50 basis point cut in September."

He confirmed that he does not expect a change in market direction despite the more than 10% drop in stock markets, and that the declines are considered natural after a strong rise in previous periods, particularly for technology stocks.

Levant News

Resignation and Escape of Bangladesh's Prime Minister After Protesters Storm the Palace Four Hezbollah Fighters Killed in Israeli Airstrike

BENEFIT, the Kingdom’s innovator and leading company in Fintech and electronic financial transactions service, held its Annual General Meeting (AGM) at the company’s headquarters in the Seef District.
During the meeting, shareholders approved all items listed on the agenda, including the ratification of the minutes of the previous AGM held on 26 March 2024. The session reviewed and approved the Board’s Annual Report on the company’s activities and financial performance for the fiscal year ended 31 December 2024, and the shareholders expressed their satisfaction with the company’s operational and financial results during the reporting period.
The meeting also reviewed the Independent External Auditor’s Report on the company’s consolidated financial statements for the year ended 31 December 2024. Subsequently, the shareholders approved the audited financial statements for the fiscal year. Based on the Board’s recommendation, the shareholders approved the distribution of a cash dividend equivalent to 10% of the paid-up share capital.
Furthermore, the shareholders endorsed the allocation of a total amount of BD 172,500 as remuneration to the members of the Board for the year ended 31 December 2024, subject to prior clearance by related authorities.
The extension of the current composition of the Board was approved, which includes ten members and one CBB observer, for a further six-month term, expiring in September 2025, pending no objection from the CBB.
The meeting reviewed and approved the Corporate Governance Report for 2024, which affirmed the company’s full compliance with the corporate governance directives issued by the CBB and other applicable regulatory frameworks. The AGM absolved the Board Members of liability for any of their actions during the year ending on 31st December 2024, in accordance with the Commercial Companies Law.
In alignment with regulatory requirements, the session approved the reappointment of Ernst & Young (EY) as the company’s External Auditors for the fiscal year 2025, covering both the parent company and its subsidiaries—Sinnad and Bahrain FinTech Bay. The Board was authorised to determine the external auditors’ professional fees, subject to approval from the CBB, and the meeting concluded with a discussion of any additional issues as per Article (207) of the Commercial Companies Law.
Speaking on the company’s performance, Mr. Mohamed Al Bastaki, Chairman BENEFIT , stated: “In terms of the financial results for 2024, I am pleased to say that the year gone by has also been proved to be a success in delivering tangible results. Growth rate for 2024 was 19 per cent. Revenue for the year was BD 17 M (US$ 45.3 Million) and net profit was 2 Million ($ 5.3 Million).

Mr. Al Bastaki also announced that the Board had formally adopted a new three-year strategic roadmap to commence in 2025. The strategy encompasses a phased international expansion, optimisation of internal operations, enhanced revenue diversification, long-term sustainability initiatives, and the advancement of innovation and digital transformation initiatives across all service lines.
“I extend my sincere appreciation to the CBB for its continued support of BENEFIT and its pivotal role in fostering a stable and progressive regulatory environment for the Kingdom’s banking and financial sector—an environment that has significantly reinforced Bahrain’s standing as a leading financial hub in the region,” said Mr. Al Bastaki. “I would also like to thank our partner banks and valued customers for their trust, and our shareholders for their ongoing encouragement. The achievements of 2024 set a strong precedent, and I am confident they will serve as a foundation for yet another successful and impactful year ahead.”
Chief Executive of BENEFIT; Mr. Abdulwahed AlJanahi commented, “The year 2024 represented another pivotal chapter in BENEFIT ’s evolution. We achieved substantial progress in advancing our digital strategy across multiple sectors, while reinforcing our long-term commitment to the development of Bahrain’s financial services and payments landscape. Throughout the year, we remained firmly aligned with our objective of delivering measurable value to our shareholders, strategic partners, and customers. At the same time, we continued to play an active role in enabling Bahrain’s digital economy by introducing innovative solutions and service enhancements that directly address market needs and future opportunities.”
Mr. AlJanahi affirmed that BENEFIT has successfully developed a robust and well-integrated payment network that connects individuals and businesses across Bahrain, accelerating the adoption of emerging technologies in the banking and financial services sector and reinforcing Bahrain’s position as a growing fintech hub, and added, “Our achievements of the past year reflect a long-term vision to establish a resilient electronic payment infrastructure that supports the Kingdom’s digital economy. Key developments in 2024 included the implementation of central authentication for open banking via BENEFIT Pay”
Mr. AlJanahi concluded by thanking the Board for its strategic direction, the company’s staff for their continued dedication, and the Central Bank of Bahrain, member banks, and shareholders for their valuable partnership and confidence in the company’s long-term vision.