Published: Wed, June 05, 2019
Markets | By Otis Pena

Google, Facebook, and Apple shares fall due to antitrust probes

Google, Facebook, and Apple shares fall due to antitrust probes

Facebook and Amazon will reportedly be overseen by the Federal Trade Commission.

Coupled with a renewed pressure on Facebook shares, which fell 4% on Monday on similar fears of increasing potential for action by U.S. regulators, the tech-heavy Nasdaq exchange was pushed into correction territory. Reuters reported that the DOJ has been given jurisdiction over a potential probe of Apple.

Since Facebook bought Instagram, the photo app has copied many of rival Snapchat's features, including face filters and stories. The news also sent shares of Amazon.com Inc. down as much as 5.4% and Apple as much as 2.7%.

Investors may have reacted immediately to the uncertainty, but investigations if any materialize would take years.

Lawmakers announced the probe Monday to address the question of whether Congress should pass tougher anti-trust laws. Massachusetts Senator Elizabeth Warren laid out a detailed plan for breaking up the tech giants in March.

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President Donald Trump has previously called for closer scrutiny of social media companies, with the UK Government under growing pressure to rein them in.

He said the investigation would not target one specific company but rather focus on the belief that "the internet is broken". The DOJ will examine Apple and Google, while the FTC will tackle Amazon and Facebook. A previous FTC investigation into Google was shut down in 2013 without major action against the company.

People briefed on the matter say neither the Justice Department nor the FTC have contacted Google or Amazon about any probes, and that company executives are unaware of what issues regulators are reviewing.

It is rare to break up a company but not unheard of, with Standard Oil and AT&T being two of the biggest examples. Post has a buy rating on the stock. Renewed US scrutiny follows European Union regulatory action that led to multibillion-dollar antitrust fines.

"There's still a long way to go before there is even an investigation", he said. "I think (the speculation) is becoming more real, but antitrust is not a 24-hour event", said Blair Levin, a fellow with the Brookings Institution who formerly served as chief of staff to a Federal Communications Commission chairman.

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