Meta (FB) stock rout sends shockwaves across tech sector

February 03, 2022 05:55 PM PST | By Rupam Roy

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Meta (FB) stock rout sends shockwaves across tech sector — Image source: mundissima,shutterstock

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Highlights

The FB stock plunged over 26% on Thursday, continuing its fall on the previous day.

CEO Mark Zuckerberg's net worth was reduced to US$85 billion after losing US$29 billion in a single day.

He is now at the 12th spot on the Forbes' real-time billionaire list.

Meta Platforms, Inc’s (NASDAQ:FB) historic stock rout on Wednesday that vaporized US$200 billion in market value, the biggest single-day loss, has sent shockwaves across the tech sector.

The slump jolted the stock market on Thursday as investors grappled with the news, triggering a panic selloff. Shares of other big technology companies, such as Amazon.com Inc, Alphabet Inc, and Microsoft Corporation that dominate the exchanges by market cap, took a beating.

Amazon (AMZN) shares declined over 7.4% in the regular session. Alphabet Inc (Googl) fell 3.32%, Microsoft retreated 3.9%, and Spotify Technology Inc (SPOT) fell more than 15%.

The selloff was not limited to the technology sector. As many as nine S&P 500 stock segments withdrew. In other tech stocks, Twitter, Inc. (TWTR) tumbled more than 5.5%.

Verizon Communication Inc. (VZ) was down 0.13%, and Comcast Corporation (CMCSA) fell 0.55%. The Walt Disney Company (DIS) retreated 1.74%.

CEO Mark Zuckerberg’s net worth shrank to US$85 billion after losing US$29 billion on Wednesday. The FB stock shed 26% on Thursday as its fall continued from the previous day.

Zuckerberg, who owns about a 12% stake in Meta, is now at the 12th spot on the Forbes' real-time billionaire list, just below the Indian corporate bigwigs, Gautam Adani and Mukesh Ambani.

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Some 20 brokerages have trimmed their price targets on the FB stock on Thursday after the company reported disappointing guidance the day before.

The social media company blamed the weak results on iPhones’ new privacy policy. CFO Dave Wehner said the company might lose up to US$10 billion due to the new privacy rules in 2022.

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Rout offers an opportunity for investors

The fall in FB stock prices offers an opportunity for retail investors who couldn’t buy the stock due to its high cost. This may help gain some lost ground for the FB stock.

Last year, Zuckerberg had sold a considerable chunk of his Meta shares. The sale was part of a pre-set trading plan that executives use to avoid insider trading allegations.

In the after-market trading on Thursday, the FB stock rose 1.55% to US$241.44 after plunging 26.39% to US$237.76 in the regular session.

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