Company shares of U.S. tech behemoths dropped significantly on Monday following news about the government's latest crackdown on potential anti-competitive practices within some of the world's biggest tech giants including, Google, Facebook, Amazon, and Apple.
According to CNBC, Amazon dropped by 4.6 percent, Apple slid only by one percent, while both Alphabet (Google's parent company) and Facebook saw a whopping six percent drop in shares. The figures account for total losses of $130 billion in market value.
The bearish reaction of stock markets came amid earlier reports regarding the U.S. Justice Department setting watchful eyes on giant firms potentially practicing business that could be harmful to global and local competition.
Multiple outlets reported over the weekend that investigations are still in the early stages. Probing parties will be looking at published accounts for now. It has yet to be revealed what other aspects of tech business the Justice Department will look into.
D.A. Davidson analysts argued that future expansion in the tech industry could be hampered by "the potential for antitrust and regulation across the globe." They said concerns about the potential dangers of extreme tech influence on consumers have been raised in foreign governments.
Some industry experts noted that investigations on tech practices may put companies under heat for months and even years. This is not to mention that markets already reacted negatively even if the probe is still in the early stages.
Renowned professor of law at Rutgers Law School, Michael Carrier indicated that both Republicans and Democrats are concerned about the potential issues revolving around "Big Tech." For politicians, antitrust is the way forward, Carrier said.
It was also revealed on Monday that the DOJ will be handling the potential probe into Google and Apple. The U.S. Federal Trade Commission (FTC), on the other hand, will be tasked to look into Facebook and Amazon business standards.
The division of jurisdiction tasks has raised talks about the potential political drive regarding monopolies in the "Big Tech" circle that may not be inclined towards consumer welfare.
It is expected that the investigations will unravel matters that could legally bind the four U.S. tech behemoths - if results indicate that there have been antitrust violations in business practices in Silicon Valley.
House Judiciary Committee Chairman Rep. Jerrold Nadler said in a statement that there is "growing evidence" regarding the possibility that American tech giants are in control of some key aspects of Internet markets including communications, content, and commerce.
More details about the probe are expected to be released in the coming weeks.
