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Sunday 23

September, 201810:48 AM



European stocks fall on emerging market angst; US tech shares tumble

European stocks fall on emerging market angst; US tech shares tumble

US tech shares tumbled Wednesday following a tough congressional hearing with Facebook and Twitter while European and Asian bourses retreated on growing concern about emerging market economies.

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06.09.2018 08:32 AM

US tech shares tumbled Wednesday following a tough congressional hearing with Facebook and Twitter while European and Asian bourses retreated on growing concern about emerging market economies.

Executives from the two social media companies acknowledged they had been caught off guard ahead of the 2016 US elections when their platforms were manipulated by Russian interests, but said they were taking steps to address the problem and pledged more action ahead.

The hearing elevated the prospect of tougher regulation from Washington on technology companies, an idea furthered later Tuesday when the US Justice Department said it would probe whether the platforms were stifling conservative ideas.

Shares of Facebook and Twitter fell, along with Apple, Google-parent Alphabet and Microsoft. The Nasdaq finished down 1.2 percent. 

"When major companies testify in front of the Congress it's never a good thing" for their stock price, said Tom Cahill, portfolio strategist at Ventura Wealth Management.

"We know there is going to be an increase in regulation, we don't know yet what form it will take."

Emerging market woes

Bourses in London, Paris and Frankfurt, meanwhile, all lost at least one percent as worries about emerging markets added to trade war fears. Markets in Asia also fell.

"Risk aversion remains at the forefront of the current market sentiment," said Lukman Otunuga, a research analyst at FXTM.

After Turkey and Argentina's recent headline-making problems, South Africa became the latest emerging market country to spark panic with data showing a shock plunge into recession for the one-time economic starlet.

"It has certainly been a terrible trading week thus far for most major EM currencies as investors begin to compare the ongoing pressure in EM currencies to the 1997 Asian financial crisis," said Otunuga at FXTM.

India's rupee was sitting at a record low and the Indonesian rupiah at levels last seen during the 1998 Asian financial crisis.

In other foreign exchange news, the pound rose following a Bloomberg News report that the British and German governments had dropped key Brexit demands, easing the path to a potential deal.

Key figures around 2100 GMT

New York - Dow: UP 0.1 percent at 25,974.99 (close)

New York - S&P 500: DOWN 0.3 percent at 2,888.60 (close)

New York - Nasdaq: DOWN 1.2 percent at 7,995.17 (close)

London - FTSE 100: DOWN 1.0 percent at 7,383.28 (close)

Frankfurt - DAX 30: DOWN 1.4 percent at 12,040.46 (close)

Paris - CAC 40: DOWN 1.5 percent at 5,260.22 (close)

EURO STOXX 50: DOWN 1.3 percent at 3,315.62 (close)

Tokyo - Nikkei 225: DOWN 0.5 percent at 22,580.83 (close)

Hong Kong - Hang Seng: DOWN 2.6 percent at 27,243.85 (close)

Shanghai - Composite: DOWN 1.7 percent at 2,704.34 (close)

Euro/dollar: UP at $1.1631 from $1.1582 at 2100 GMT

Pound/dollar: UP at $1.2907 from $1.2855

Dollar/yen: DOWN at 111.53 yen from 111.41 yen

Oil - Brent Crude: DOWN 90 cents at $77.27 per barrel

Oil - West Texas Intermediate: $1.15 at $68.72 (close)
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