Facebook fallout; Alwaleed speaks; FedEx earnings
1. Facebook drama: The social network is caught in a data privacy firestorm that shows no signs of cooling off.
Facebook(FB) admitted over the weekend that a company linked to President Donald Trump’s campaign had accessed and improperly stored a huge trove of its user data.
The controversy erupted as UK media and The New York Times reported that data analysis firm Cambridge Analytica tried to influence how Americans voted using information gleaned from millions of Facebook profiles.
Facebook stock suffered its biggest drop in four years on Monday, shedding 7%. Investors still have not heard from CEO Mark Zuckerberg or COO Sheryl Sandberg.
“What matters for this stock, at this time, are the headlines,” wrote analysts at Macquarie Capital.
Facebook is still one of the most valuable US companies, with a market cap of about $ 500 billion. It’s behind only Apple (AAPL), Google parent Alphabet (GOOGL), Amazon (AMZN), Microsoft (MSFT) and about even with Berkshire Hathaway (BRKA).
Its shares were poised to drop further on Tuesday.
2. Alwaleed speaks: Saudi Prince Alwaleed bin Talal has given his first interview since being caught up in an anti-corruption sweep.
The prince, who spent nearly three months locked up in Riyadh’s Ritz-Carlton, told Bloomberg that he is now looking to reshape his business empire. The billionaire and global investor said he’s likely to split the assets of Kingdom Holding, spinning off its Saudi property business. Kingdom Holding owns shares in Twitter (TWTR) and Citigroup (C), among others.
Alwaleed said he’s also hoping to reassure investors.
“I understand it’s not going to be easy at all — some people in business community will be doubtful, will say, ‘What’s going on?,'” he told Bloomberg.
3. Pound relief: The British pound strengthened 0.2% against the dollar on Tuesday, pushing the currency above $ 1.40.
Investors are cheering a joint legal agreement between Britain and the European Union on the terms of a transition period lasting about 21 months after Brexit takes effect in March 2019.
There is still much work to be done on hammering out the details of the transition and the UK’s future trading relationship with its biggest export market.
4. Global market overview: US stock futures were lower on Tuesday.
Most European markets advanced in early trade. Asian markets closed mixed.
On Monday, the Dow Jones industrial average and S&P 500 dropped 1.4% and the Nasdaq shed 1.8%.
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5. Stock market movers — Oracle: Shares in Oracle (ORCL) were lower after the company reported disappointing sales.
FedEx(FDX) will release earnings after the close.
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6. Coming this week:
Tuesday — FedEx (FDX) earnings
Wednesday — General Mills earnings; AT&T trial opening statements; Powell’s first press conference
Thursday — Darden, Nike (NKE) earnings