(Bloomberg) -- U.S. President Donald Trump's address to the United Nations General Assembly helped knock $56 billion off the value of some of the biggest technology companies.
The combined market cap of FAANG stocks -- made up of Facebook Inc., Amazon.com Inc., Apple Inc., Netflix Inc., and Google parent Alphabet Inc. -- tumbled after Trump made negative remarks about the growing power of social media platforms, a signal to some investors that the industry could soon face extra scrutiny from federal antitrust regulators.
“It's a reminder that this is a risk they've never had before and you have to take that into account from a valuation standpoint,” said Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter. “The president has a belief that social media companies are extremely powerful and not particularly favorable to his policies or potentially his point of view.”
In his speech, which also touched on U.S.-China trade tension, Trump said that social media platforms are acquiring “immense power” and that “a free society cannot allow social media giants to silence the voices of the people.”
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Facebook and Amazon were both down more than 2.5% as of 1:22 p.m. in New York for their worst days since August. Netflix fell 4.4% and Microsoft dropped 1.5%.
The tech-heavy Nasdaq Composite Index fell the most of the major equity indexes, sinking 1.7%. That brought the gauge below its 50-day moving average and right up against measure's 100-day moving average, technical levels that have provided both resistance and support through August.
--With assistance from Vildana Hajric.
To contact the reporter on this story: Sarah Ponczek in New York at sponczek2@bloomberg.net
To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Brendan Walsh, Randall Jensen
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