A wave of antitrust probe headlines on Facebook and Google parent Alphabet just yanked about $137 billion from Fang stocks’ market values.
Some $41bn evaporated from Facebook on Monday as a source said the US Federal Trade Commission will oversee antitrust scrutiny into whether the firm’s practices harm competition in the digital market under an agreement with the Justice Department.
That added to early-morning losses as the group was hammered by a report the Justice Department was preparing an antitrust investigation into Google. Some $52bn was erased from Google’s market value as the stock fell 6.9 per cent, on pace for the lowest close since January 3.
The move comes as politicians from both parties face increasing pressure to apply tougher regulation on tech and telecom giants like Alphabet and Facebook and even break up the companies – which are among the largest in the US. For investors, tougher regulation most likely means a negative impact on profits, making it harder to justify the rich valuations of some of the world’s highest-flying stocks.
Two Fang megacaps that were not directly targeted – Netflix and Amazon.com – also sold off sharply. Amazon plunged 4.7 per cent as about $41bn was wiped out of the e-commerce giant. Netflix lost $2.5bn from its market value as the stock fell 1.6 per cent.
Updated: June 4, 2019 08:18 AM