Facebook and Twitter, the two largest social media platforms to permanently ban President Donald Trump for his role in last week’s Capitol riots, saw $51.2 billion in combined market value erased over the last two trading sessions.
Companies across sectors have responded to the president’s rhetoric in recent days by pausing political donations, making statements decrying his inflammatory remarks, and pulling products with links to right-wing movements.
Facebook and Twitter possibly took the biggest retaliatory steps when they indefinitely banned Trump from their platforms on Thursday and Friday, respectively.
Both companies cited the risk of additional violence for their bans, but investors largely balked at the action.
Facebook tumbled 4% on Monday and another 2.2% on Tuesday as shareholders dumped the stock, likely fearing the ban could drive users off the platform.
By the time markets closed on Tuesday, Facebook’s market cap sat $47.6 billion below its Friday level.
Twitter plunged 6.4% to start the week and dipped another 2.4% as the sell-off continued into Tuesday’s close. The declines saw Twitter’s market cap drop by $3.5 billion.
To be sure, Twitter rose as much as 2.9% on Wednesday while Facebook wavered at its previous closing level.
And analysts haven’t lowered the stocks’ median price targets following the bans, signaling the slides were likely knee-jerk reactions that will reverse over time.
Other tech giants responding to last week’s insurrection have fared better through the week. Apple and Google have both climbed slightly since announcing after Friday’s close they would remove right-wing social network Parler from their app stores.
Amazon shares are up 1.6% since announcing on Sunday that it kicked Parler off of its web hosting service.
Still, the actions could come back to bite tech companies in the final week of Trump’s presidency.
CNN reported on Monday that Trump might retaliate against tech giants for their bans. It’s not yet clear what the president’s actions would look like and if they will materialize before President-elect Joe Biden is inaugurated.
Facebook traded at $251.70 per share as of 10:25 a.m. ET Wednesday, down roughly 8% year-to-date.
Twitter traded at $47.94 per share, down 12% year-to-date.
–
You can follow Albert on Twitter. Or join the free mailing list (top right)
Feel free to comment on story below
Albert Jack books available for download here