Meta Faces Market Drop After Donald Trump's Remarks

Facebook, now part of Meta Platforms, is back in the difficult situation because of some sharp words from former President Donald Trump.

by Faruk Imamovic
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Meta Faces Market Drop After Donald Trump's Remarks
© Getty Images/Chip Somodevilla

Facebook, now part of Meta Platforms, is back in the hot seat because of some sharp words from former President Donald Trump. His recent comments caused quite a stir, even affecting Meta's stock prices. It's the latest round in the ongoing saga between Trump and the social media powerhouse, sparking debates about how big political names can shake up the tech world's financial scene.

A Quick Drop in the Market

This week, Meta's stocks took a nosedive, losing about 4% on Monday right after Trump slammed Facebook on CNBC, calling it "an enemy of the people." This drop came on the heels of a 1.2% fall on Friday, which happened after Trump dissed Facebook on his Truth Social platform.

Since Thursday night, when Trump started his barrage of comments, Meta's market value has plummeted by more than $60 billion. It's a clear sign that political opinions can really sway how investors feel and move the market.

Analysts, like Gil Luria from D.A. Davidson, are pointing fingers at Trump's harsh words as the main reason for the stock sell-off. They mention how Facebook seems to get pulled into political debates now and then, and it's never good news for them.

Politics Meets the Stock Market

Trump's recent stand against banning TikTok, suggesting it might just make Facebook stronger, throws an interesting twist into the story. It's especially notable since there's a strong push from both sides in Congress to ban TikTok because of its links to China.

Trump's long-standing issues with Facebook, including banning him for two years after the Capitol riot, add more layers to his recent outbursts and their effects on the market. Meta hasn't said anything about Trump's comments, leaving us all guessing about the ongoing tension.

Investors seem pretty spooked, with Meta's stock hitting its lowest point since December 2022. This drop hints at worries that Facebook might become a political punching bag again. Gil Luria is tossing around some thoughts that if Trump gets back into office, he could make things tough for Meta, especially when it comes to buying other companies, something that's been key to their growth.

He's hinting at the big impact a president can have, not just on policies but on how attractive a company can be to certain groups of people.

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