camila October 5, 2021

LONDON (BLOOMBERG) – Reports of global outages for users of its social-media apps help drive the biggest drop in Facebook’s shares in nearly a year on Monday (Oct 4).

The tech giant is also facing questions from a whisteblower who will be testifying before the US Congress.

Facebook shares closed down 4.9 per cent, the most since Nov 9. The stock has fallen about 15 per cent since hitting a record on Sept 7.

Mark Zuckerberg’s personal wealth fell by nearly US$7 billion (S$9.5 billion) in a few hours, knocking him down a notch on the list of the world’s richest people.

The stock slide on Monday sent Mr Zuckerberg’s worth down to US$120.9 billion, dropping him below Bill Gates to No. 5 on the Bloomberg Billionaires Index. He’s lost about US$19 billion of wealth since Sept 13, when he was worth nearly US$140 billion, according to the index.

On Sept 13, the Wall Street Journal began publishing a series of stories based on a cache of internal documents, revealing that Facebook knew about a wide range of problems with its products – such as Instagram’s harm to teenage girls’ mental health and misinformation about the Jan 6 Capitol riots – while downplaying the issues in public. The reports have drawn the attention of government officials, and on Monday, the whistleblower revealed herself.

In response, Facebook has emphasised that the issues facing its products, including political polarisation, are complex and not caused by technology alone.

Facebook’s share plunge came amid a broad tech rout on Wall Street amid concern that surging prices for raw materials risk fanning inflation and sapping economic momentum.

Amazon.com dropped 3 per cent, followed by Apple sliding 2.5 per cent. Microsoft . lost 2.1 per cent and Google parent Alphabet retreated 2 per cent.

Technology stocks are bearing the brunt of selling amid a spike in Treasury yields on inflation fears. Treasury yields are used to calculate the present-day value of profits expected to be delivered far into the future. A sustained rise in Treasury yields is hurting the earnings outlook for companies with high valuations.

Amazon.com dropped 3 per cent, followed by Apple sliding 2.5 per cent. Microsoft . lost 2.1 per cent and Google parent Alphabet retreated 2 per cent.