Dow drops 336 points as Facebook plunges

Facebook is on track for its worst day in more than five years, and it's dragging the stock market down with it....

Posted: Mar 20, 2018 12:09 AM
Updated: Mar 20, 2018 12:09 AM

Facebook is on track for its worst day in more than five years, and it's dragging the stock market down with it.

The Dow fell as much as 493 points on Monday and is in negative territory for the year. Facebook tumbled 7%, helping to pull the S&P 500 down 1.7% and the Nasdaq 2.2%.

Big tech companies, including Facebook, Amazon, Netflix and Google, have helped contribute to the market's climb, but all four dropped Monday. The S&P's tech sector fell 2.9%. It was the worst performing sector on the index.

Facebook is under pressure from lawmakers in both the United States and the UK after more than 50 million users' data ended up in the wrong hands.

Related: Facebook is facing an existential crisis

"When you have real damage to a large enough company, that translates into the indexes as a whole," Brad McMillan, chief investment officer at Commonwealth Financial Network, said.

Democratic Senator Amy Klobuchar has called on Zuckerberg to appear before Congress to testify about "what Facebook knew about misusing data from 50 million Americans in order to target political advertising and manipulate voters." John Kennedy, a Republican senator from Louisiana, joined Klobuchar in calling for Zuckerberg to testify.

Related: Why nobody can tell Mark Zuckerberg what to do at Facebook

Investors worry that new regulations on Facebook or an exodus of users from the platform could slow down one of the world's most valuable companies and chill the tech sector's rise.

"Investors are questioning [Facebook's] growth potential. As a result, they are willing to take profits," said Sam Stovall, chief investment strategist at CFRA Research.

Wall Street is also weighing President Trump's next move on trade with China and the first Federal Reserve meeting with Chairman Jay Powell at the helm beginning Wednesday.

The White House confirmed to CNN last week that the administration is considering tariffs on at least $30 billion worth of imports from China. The move would be retaliation for alleged Chinese technology intellectual property theft. Trump has already imposed tariffs on steel and aluminum, setting off fears of retaliation by US trading partners and a wider trade fight.

Related: Major retailers to Trump: New China tariffs will hurt American shoppers

On Monday, 49 of the nation's largest retailers, including Walmart, Target and Costco, said new tariffs would hurt consumers.

"As you continue to investigate harmful technology and intellectual property practices, we ask that any remedy carefully consider the impact on consumer prices," the letter stated.

Investors are also preparing for the Fed to raise rates when it meets Wednesday for a two-day policy conference. CME Group predicts a 94% chance the Fed hikes rates by a quarter percentage point.

Related: Trump spending spree may speed up the Fed

"We have a lot more uncertainty with respect to the Fed than we've had in years," McMillan said. "Everyone believes Chair Powell is similar to Chair Yellen, but we don't really know."

McMillan argued the Fed's path to gradually normalize interest rates, which have been at historical lows since the 2008 financial crisis, is a sign of the economy's strength.

"This is essentially the Fed endorsing the fact that the market is growing. I think the market reaction ultimately would end up being positive."

Stovall of CFRA Research is projecting the Fed will raise interest rates three times in 2018, but investors have left open the possibility of a fourth. Higher interest rates bring down the value of stocks by making borrowing costs higher for companies. As rates climb higher, returns in the bond market can also look more attractive than riskier stocks.

-CNNMoney's Matt Egan contributed to this story.

Minnesota Coronavirus Cases

Data is updated nightly.

Cases: 604184

Reported Deaths: 7620
CountyCasesDeaths
Hennepin1248631774
Ramsey52480895
Dakota46804470
Anoka42746458
Washington27416291
Stearns22552224
St. Louis18137312
Scott17548135
Wright16370149
Olmsted13391102
Sherburne1201295
Carver1066448
Clay825892
Rice8196110
Blue Earth762543
Crow Wing681594
Kandiyohi667885
Chisago619752
Otter Tail585884
Benton582998
Goodhue483874
Douglas475381
Mower470733
Winona461251
Itasca459263
Isanti439964
McLeod430361
Morrison424662
Nobles407950
Beltrami407561
Steele397616
Polk389072
Becker386655
Lyon363853
Carlton352756
Freeborn346932
Pine335023
Nicollet331045
Mille Lacs311654
Brown307840
Le Sueur297226
Cass286032
Todd285632
Meeker263142
Waseca238023
Martin235332
Roseau211021
Wabasha20783
Hubbard196441
Dodge18783
Renville182446
Redwood176338
Houston174616
Cottonwood167124
Wadena162823
Fillmore157410
Faribault154419
Chippewa153938
Pennington153820
Kanabec146828
Sibley146810
Aitkin138837
Watonwan13579
Rock128719
Jackson122612
Pipestone116726
Yellow Medicine114920
Pope11296
Murray107010
Swift106918
Koochiching95217
Stevens92411
Clearwater89016
Marshall88817
Wilkin83213
Lake83120
Lac qui Parle75622
Big Stone6044
Grant5938
Lincoln5843
Mahnomen5669
Norman5479
Kittson49022
Unassigned48293
Red Lake4017
Traverse3775
Lake of the Woods3453
Cook1720

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 370914

Reported Deaths: 6048
CountyCasesDeaths
Polk58232640
Linn21204339
Scott20306247
Black Hawk16119312
Woodbury15238230
Johnson1461585
Dubuque13506211
Dallas1128999
Pottawattamie11223174
Story1071448
Warren583991
Clinton561493
Cerro Gordo553593
Sioux517074
Webster515494
Muscatine4880106
Marshall486676
Des Moines467271
Wapello4337122
Buena Vista426940
Jasper421172
Plymouth402981
Lee382356
Marion366076
Jones300957
Henry294637
Bremer288261
Carroll286852
Crawford268540
Boone268434
Benton259655
Washington256751
Dickinson249344
Mahaska232351
Jackson225242
Clay216627
Kossuth216166
Tama211871
Delaware210943
Winneshiek198535
Page194522
Buchanan193733
Cedar192223
Hardin187444
Fayette186543
Wright185940
Hamilton181851
Harrison179973
Clayton171057
Butler166235
Madison164619
Mills163724
Floyd163342
Cherokee159338
Lyon158841
Poweshiek157036
Allamakee152652
Hancock150234
Iowa149824
Winnebago144531
Cass139255
Calhoun138913
Grundy137333
Emmet135841
Jefferson133435
Shelby131537
Sac130920
Union129935
Louisa129749
Appanoose129049
Mitchell126643
Chickasaw124717
Franklin123323
Guthrie123232
Humboldt119626
Palo Alto113523
Howard104922
Montgomery103638
Clarke100924
Keokuk96532
Monroe96330
Unassigned9560
Ida91535
Adair87332
Pocahontas85822
Davis85225
Monona82931
Osceola78916
Greene78011
Lucas77923
Worth7598
Taylor66812
Fremont6269
Decatur6169
Van Buren56418
Ringgold56324
Wayne54423
Audubon53411
Adams3444
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