US: Facebook scandal induces heavy equity tumble – Danske Bank

Analysts at Danske Bank point out that Facebook scandal has induced heavy equity tumble and the catalyst was tech stock Facebook, which fell close to 7%.

Key Quotes

“In an Orwellian twist, the Financial Times reported that data firm Cambridge Analytica may have used Facebook to harvest data on 50 million people without consent. The user information was exploited for political benefit, including aiding the Trump presidential campaign. The data firm has close ties with President Trump’s former Chief Strategist Steve Bannon. Officials across the Atlantic are calling for action.”

“The tech sell-off led stocks into the red. US flagship stock index S&P 500 was down over 2% before recovering up to the close. The implied volatility index VIX rose up to 19 and high yield credit spreads rose.”