Monday, March 19, 2018  
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US Indexes Skid, Tech Stocks Plunge    03/19 12:46

   A sharp loss for Facebook is dragging technology companies lower Monday as 
U.S. stock indexes skid. 

   NEW YORK (AP) -- A sharp loss for Facebook is dragging technology companies 
lower Monday as U.S. stock indexes skid. The social media company is facing new 
criticism related to privacy issues following reports a data mining firm 
working for the Trump campaign improperly obtained and then kept data on tens 
of millions of users. The stock is on pace for its biggest loss since 2012.

   The British pound is rising and European stocks are down after Britain and 
the European Union said they are getting closer to a deal that will complete 
Britain's departure from the EU.

   KEEPING SCORE: The S&P 500 index sank 42 points, or 1.6 percent, to 2,709 as 
of 12:20 p.m. Eastern time. The benchmark index is on track for its biggest 
loss since Feb. 8, when it tumbled almost 4 percent. The Dow Jones industrial 
average fell 332 points, or 1.3 percent, to 24,613. The Nasdaq composite gave 
up 169 points, or 2.3 percent, to 7,314. The Russell 2000 index of 
smaller-company stocks declined 23 points, or 1.5 percent, to 1,562.

   UNFRIENDED: Facebook said Friday that the data mining company Cambridge 
Analytica improperly obtained data on some of its users, and that it had 
suspended Cambridge while it investigates. Facebook said the company obtained 
data from 270,000 people who downloaded a purported research app that was 
described as a personality test.

   The New York Times and the Guardian reported that Cambridge was able to tap 
the profiles of more than 50 million Facebook users without their permission. 
Facebook first learned of the breach more than two years ago but hadn't 
disclosed it. A British legislator said Facebook had misled officials while 
Senator Amy Klobuchar of Minnesota said Facebook CEO Mark Zuckerberg should 
testify before the Senate Judiciary Committee.

   Facebook sank $13.81, or 7.5 percent, to $171.28. That put the stock on pace 
for its biggest loss in five and a half years.

   Other technology companies also struggled. Microsoft slid $1.86, or 2 
percent, to $92.74.

   THE QUOTE: Daniel Ives, chief strategy officer and head of technology 
research for GBH Insights, said this is a crisis for Facebook, and it will have 
to work hard to reassure users, investors and governments.

   "This is a defining moment for them," he said. "It either becomes a blip on 
the radar and it helps the platform mature... or it becomes the start of 
something broader."

   Ives said Wall Street is more concerned about the latest situation than it 
was about issues like Facebook's platform spreading fake news. That's because 
Cambridge reportedly got access to the personal data of a large number of 
users, and the backlash suggests Facebook may face more regulation or could 
lose users, advertisers or advertising revenue.

   He estimated that $5 billion in annual revenue for Facebook might be at risk 
and that the company has to work hard to assure users and government agencies. 
He said the situation could create problems for other tech companies, 
especially Twitter and Alphabet's YouTube unit.

   Alphabet lost $38.85, or 3.4 percent, to $1,095.57 and Twitter slipped 88 
cents, or 2.5 percent, to $34.70.

   BYE-BYE BRITAIN: Representatives of Britain and the European Union said they 
made progress on the terms of Britain's departure from the bloc. British envoy 
David Davis said important steps have been made in the last few days and he 
thinks EU leaders will back them in a meeting Thursday and Friday. Britain is 
scheduled to officially leave the EU on March 29, 2019.

   The pound rose to $1.4040 from $1.3938. The British FTSE 100 index fell 1.6 
percent and Germany's DAX fell 1.6 percent as well. France's CAC-40 was 1.2 
percent lower.

   JUST ANOTHER MERGER MONDAY: Internet technology company CSRA rose 43 cents, 
or 1 percent, to $41.08 after CACI International offered to buy it for $44 a 
share in cash and stock, or about $7.2 billion. Defense contractor General 
Dynamics agreed to buy CSRA in February for $40.75 a share in cash, or about 
$6.8 billion. General Dynamics said it's proceeding with that offer, suggesting 
it doesn't plan to raise its price.

   CACI fell $12.40, or 7.9 percent, to $145.05 and  General Dynamics rose 71 
cents to $223.45.

   KLA-Tencor, which makes equipment used in manufacturing semiconductors, said 
it will buy Orbotech, a company that makes equipment for electronics 
manufacturers. The deal values Orbotech at $38.86 a share in cash and stock, or 
$1.88 billion. Orbotech added $2.84, or 4.7 percent, to $62.74 and KLA-Tencor 
skidded $9.08, or 7.5 percent, to $111.54.

   BONDS: Bond prices turned higher. The yield on the 10-year Treasury note 
fell to 2.83 percent from 2.85 percent.

   ENERGY: Benchmark U.S. crude fell 40 cents to $61.94 a barrel in New York. 
Brent crude, used to price international oils, lost 21 cents to $66 per barrel 
in London.

   ASIA: Tokyo's Nikkei 225 fell 0.9 percent and Hong Kong's Hang Seng edged up 
less than 0.1 percent. Seoul's Kospi lost 0.8 percent.

   CURRENCIES: The dollar fell to 105.83 yen from 106.10 yen. The euro rose to 
$1.2335 from $1.2284.


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