Stocks – S&P Closes Lower on Fears Tech Set for Regulatory Spotlight


Stocks - S&P Closes Lower on Fears Tech Set for Regulatory Spotlight – The S&P closed lower Wednesday as tech stocks slumped after U.S. lawmakers touted a tougher stance on regulating social media companies, which could hurt profits, while concerns over trade also weighed.

The Dow Jones Industrial Average rose about 0.09%. The S&P 500 fell 0.28%, while the Nasdaq Composite fell about 1.19%.

A sea of red washed over tech stocks on Wednesday, weighing on the broader market, as Twitter CEO Jack Dorsey and Facebook COO Sheryl Sandberg testified before Congress about their efforts to prevent abuse and protect privacy on their platforms.

Both Sandberg and Dorsey defended their efforts in preventing abuse of their platforms and conceded that they have since stepped up efforts to stop online election meddling following Russia’s interference in the 2016 U.S. election.

Still, lawmakers appear to be leaning toward the need for further regulatory scrutiny on tech companies. Attorney General Jeff Sessions will meet with state attorneys general later this month to express concerns that tech companies may be hurting competition and limiting free exchange of ideas on their platforms.

Facebook (NASDAQ:FB), Netflix (NASDAQ:NFLX) and Google-Parent (NASDAQ:Alphabet) stocks, part of the so-called FANGs, led the tech retreat. Twitter (NYSE:TWTR) dropped 6%.

Beyond the tech turmoil, trade concerns remained front and center, as the United States and Canada resumed talks to reach an agreement on a revamp of NAFTA.

Foreign Affairs Minister Chrystia Freeland described the talks as “constructive” and “positive,” insisting there was “good faith and good will on both sides,” as talks are set to continue.

The positive slant on U.S.-Canada trade talks comes as investors fret about the prospect of a ramp-up in the U.S.-China trade war.

The Trump administration could impose a 25% tariff on $200 billion worth of Chinese imported goods after the comment period expires on Thursday.

Those fears, however, had little sway on trade-sensitive names like Boeing (NYSE:BA), Caterpillar (NYSE:CAT) and 3M (NYSE:MMM), as they ended the day above the flatline.

Energy, meanwhile, was roughly unchanged, sidestepping a plunge in oil prices as investors cut bets on storm Gordon disrupting oil supplies after it weakened and did not hit the oil-rich U.S. gulf region.

On the New York Mercantile Exchange crude futures for October delivery fell $1.15 to settle at $68.42 a barrel.

There was little on the economic news front to help turn sentiment on stocks as data showed the U.S. trade deficit posted its biggest monthly increase in almost three-and-a-half years in July.

Top S&P 500 Gainers and Losers Today:

The Goodyear (NASDAQ:GT), CenterPoint Energy (NYSE:CNP) and Henry Schein (NASDAQ:HSIC) were among the top S&P 500 gainers for the session.

ABIOMED (NASDAQ:ABMD), Netflix (NASDAQ:NFLX) and Twitter (NYSE:TWTR) were among the worst S&P 500 performers of the session.


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