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Technology stocks short-circuited on Monday after being informed that key Silicon Valley companies were being subjected to unprecedented control of their business practices by government regulators who were observing anti-competitive practices.
Alphabet and Facebook, Google's parent company, both fell by more than 6%, and Amazon dropped nearly 5% according to reports that the Justice Department and the Federal Trade Commission are questioning them about claims that which they would have hindered competition.
Facebook dropped 7.5% – its biggest drop in a day in almost a year – after the Wall Street Journal reported that the FTC had been granted the right to review the impact of the company's practices. social media on digital competition.
Alphabet, meanwhile, slipped 6.1% after sources told Reuters that the Justice Department was preparing an investigation to determine whether its Internet dominance had been unfairly obtained.
Amazon lost 4.6% after discovering that the FTC was responsible for sounding the e-commerce giant's business practices.
Not even the giant Apple of Silicon Valley has escaped chaos. The iPhone maker was trading in the green since the first half of the day as investor enthusiasm grew for its annual conference of developers – but ended down 1% on the basis of the year. information that the Department of Justice has asked an investigator to conduct an anti-competitive investigation practices.
House Democrats have announced they will begin a review of Silicon Valley technology giants to determine if their size has stifled competition and hurt consumers, according to the Washington Post, which is owned by Amazon's boss. Jeff Bezos.
Facebook is already on the verge of being fined $ 5 billion by the FTC for breach of privacy.
Investors took approximately $ 5 billion from Bezos' personal portfolios and Facebook managing director Mark Zuckerberg and earned $ 40 billion from their company's market capitalization, based on the number of shares outstanding .
Google's founders Larry Page and Sergey Brin each lost $ 3 billion as investors reduced market capitalization of Alphabet by $ 50 billion.
"The concerns that the government will imply and eventually break these companies or impose fines on their operations are a major concern here," said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.
"It is very rare to dissolve a business, but not unheard of," said Justin Post, an analyst at Bank of America Merrill Lynch, in a report stressing that the process could take a long time.
"To dissociate Google, the Ministry of Justice should probably take legal action and convince judges that Google has undermined competition," he said.
The potential investigations follow accusations by President Trump against social media companies such as Google and Facebook, claiming to have suppressed conservative voices on their online platforms.
With post son
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