[Meta Shock] Lost Facebook... Market Cap Drops by 302 Trillion Won in One Day

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] The stock price of Meta Platforms, the parent company of Facebook, the world's largest social media platform, plummeted by a staggering 26%, wiping out a market capitalization of 302 trillion won in just one day. This is the largest single-day market cap loss in the history of the U.S. stock market.

On the 3rd (local time) in the New York stock market, Meta's stock closed at $237.76, down 26.39% from the previous session. This is the largest daily drop since its listing in 2012. The plunge is attributed to Meta's earnings report and future outlook released the day before, which fell short of market expectations. The crash erased a market capitalization of $251.3 billion (approximately 301.8 trillion won) from Meta. This amount is comparable to the entire market cap of Oracle, the 32nd largest company included in the S&P 500 index.

As the stock price of Meta, a representative tech stock, plunged, investor sentiment across the market froze solid. On that day, the Nasdaq index, which is tech-stock heavy, closed down 3.74% from the previous session. The Dow Jones Industrial Average and the S&P 500 index also fell by 1.45% and 2.44%, respectively. Ricardo Evangelista, senior analyst at ActiveTrade, said, "Facebook's disappointing earnings and uncertain outlook darkened market sentiment," adding, "It caused anxiety across the tech sector."

Adding to this, warnings of monetary tightening from Europe caused major countries' government bond yields to soar. The Bank of England (BOE), the UK's central bank, implemented its second rate hike, and Christine Lagarde, President of the European Central Bank (ECB), expressed concerns about inflation and hinted at the possibility of a rate increase within the year.

On that day, the U.S. 10-year Treasury yield rose 6 basis points (1 bp = 0.01 percentage points) from the previous day to around 1.83%. The 2-year yield, sensitive to monetary policy, returned to the 1.2% range.

Following Brent crude oil from the North Sea, West Texas Intermediate (WTI) crude oil also surpassed $90 per barrel, further fueling inflation concerns. The WTI price exceeding $90 per barrel is the first time since October 2014.