Nasdaq drops more than 1%, enters correction territory as regulation fears batter big tech - CNBC

Tech stocks fell on Monday, June's first day of trading, amid reports that the U.S. government is planning to target a host of big companies in the industry with antitrust and business practice probes. Shares of Alphabet, Amazon, Facebook and Apple all weighed on the market during Monday's session.

The Nasdaq Composite dropped 1.6% to enter correction territory, closing more than 10% below its record high set in late April at 7,333.02. The S&P 500 slid 0.3% to 2,744.45 while the Dow Jones Industrial Average ended the day just above breakeven at 24,819.78.

Alphabet shares pulled back 6.1% after reports said the Justice Department is preparing to launch an antitrust probe on Google. Meanwhile, Facebook dropped 7.5% after The Wall Street Journal reported the Federal Trade Commission would be able to look into Facebook's practices and how they impact digital competition.

"The whole component of what's going on in tech right now goes back to the rhetoric of Sen. Elizabeth Warren threatening to break up tech giants," said Jeff Kilburg, CEO of KKM Financial. "We thought that was just rhetoric. But now with this news hitting, it's really impactful."

Amazon shares fell 4.6% after The Washington Post said an arrangement between the Federal Trade Commission and the Justice Department put the e-commerce giant under the FTC's microscope. Apple also slipped 1% after Reuters reported the Justice Department received jurisdiction to investigate the company's practices. 

Communications services, consumer discretionary and tech were the worst-performing sectors in the S&P 500 on Monday. Communications dropped more than 2.5%, its biggest one-day drop since late October, while consumer and tech both closed more than 1% lower.

"With the trade stuff going on, [big tech] has been a bit of a hiding place," said Christian Fromhertz, CEO of The Tribeca Trade Group. "You just can't hide right now."

Mark Zuckerberg, chief executive officer and founder of Facebook Inc. attends the Viva Tech start-up and technology gathering at Parc des Expositions Porte de Versailles on May 24, 2018 in Paris, France.

Christophe Morin/IP3 | Getty Images News | Getty Images

Trade worries also weighed on the broader market.

Chinese Vice Commerce Minister Wang Shouwen said in a white paper Sunday that Washington would not be able to use pressure to force a trade deal on Beijing. He also refused to say whether the leaders of both countries would meet at the G-20 summit to work out an agreement later this month.

Wang added: "The U.S. has backtracked, and when you give them an inch, they want a yard."

The remarks from Wang follow a month of heightened trade tensions between the world's largest economies. The U.S. hiked tariffs on $200 billion worth of Chinese goods in May. China retaliated with higher tariffs on U.S. imports.

"This issue with China continues to be the big elephant in the room," said Randy Frederick, vice president of trading and derivatives at Charles Schwab. "If the two sides, China and the U.S., break down on these negotiations, we could see a 10% correction. We're more than halfway there already and talks haven't broken down yet."

"There just aren't a lot of things out there to drive the market so this issue continues to be the pivotal point," Frederick said.

The benchmark 10-year U.S. note yield fell  its lowest level since September 2017. Gold prices climbed to their highest point since late March, breaking above $1,320.

Trade worries also rattled Wall Street last week after President Donald Trump threatened to slap a 5% charge on all imports from Mexico. The threat sent stocks tumbling on Friday.

U.S. manufacturing activity in the U.S. fell last month to its slowest pace of growth since October 2016, according data from the Institute for Supply Management. The pace of expansion also disappointed economists polled by Refinitiv. 

St. Louis Federal Reserve President James Bullard said Monday that a rate cut "may be warranted soon " given the risks of rising trade tensions.

—CNBC's Sam Meredith contributed to this report.

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2019-06-03 20:15:48Z
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Google and Facebook stocks plummet on antitrust probe reports - Yahoo Finance

Alphabet stock tanking as Department of Justice eyes Google for an antitrust probe. Facebook stock also weighed by Wall Street Journal's report that the FTC is looking into probing how its practices impact digital competition. Yahoo Finance's Dan Roberts joins Seana Smith.

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2019-06-03 18:49:00Z
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Amazon adding live Prime Video TV channels in Canada - MobileSyrup

Google, Facebook and Apple take a hit from reports of antitrust probes - Yahoo Canada Finance

Algonquin Power to buy power utility in Bermuda for US$365M - BNNBloomberg.ca

OAKVILLE, Ont. -- Algonquin Power & Utilities Corp. (AQN.TO) has signed a deal to buy Ascendant Group Ltd., the parent company of Bermuda Electric Light Co., for US$365 million.

Algonquin chief executive Ian Robertson says the deal will be immediately accretive to the company's earnings.

"The acquisition of Bermuda Electric Light Company builds materially on our international growth program through the addition of this high-quality utility, Robertson said in a statement.

"In addition to Ascendant customer and employee benefits coming from the scale of our existing utility operations, we are confident that our demonstrated capability in renewable energy development can help Bermuda realize on its carbon reduction aspirations."

Bermuda Electric Light, which has roughly 370 employees, serves 63,000 residents and businesses in Bermuda.

Under the deal, Ascendant will maintain its headquarters in Bermuda.

Algonquin also says it is committed to retaining and developing the existing management and operations team at the company.

The deal, which is subject to shareholder and regulator approvals, is expected to close late this year.

Algonquin provides rate-regulated natural gas, water, and electricity generation, transmission and distribution utility services in the United States and Canada.

The company also has an international portfolio of long-term contracted wind, solar and hydroelectric generating facilities.

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June 03, 2019 at 09:13PM

Next-gen cannabis coming - Business News - Castanet.net

Photo: The Canadian Press

Edible marijuana samples are set aside for evaluation at Cannalysis, a cannabis testing laboratory, in Santa Ana, Calif.

The Canadian market for next-generation cannabis products is worth an estimated $2.7 billion annually, with edibles contributing more than half, according to a new report from Deloitte.

This spending once the final edible pot regulations roll out in the coming months is expected to be on top of the roughly $6-billion estimated domestic market for recreational and medical cannabis, the consultancy said Monday.

Consumers are looking to snap up these new pot products in addition to the dried flower, oils, plants and seeds they have been buying from legal retailers since legalization last fall, a recent survey of 2,000 Canadians conducted by Deloitte suggests.

The first wave of legalization last October was quite limited in terms of product range and the type of consumer, said Jennifer Lee, Deloitte Canada's cannabis national leader.

"When we legalize in October again for edibles, we are in a world where the formats and the assortment is much broader," she said. "The use cases are much broader."

Canada is gearing up to legalize cannabis-infused foods, beverages, topicals and other next-generation products in the coming months, once Ottawa rolls out the final regulations.

Pot companies, as well as food and beverage makers, have been preparing to roll out their own pot-infused products which they anticipate will appeal to a broader audience — particularly those who aren't interested in smoking weed.

The federal government wrapped up its consultation on the draft edible rules in February, and has said the regulations must be brought into force no later than Oct. 17, 2019.

Deloitte estimates that roughly $1.6 billion will be spent on edibles in Canada, followed by cannabis-infused beverages at $529 million and topicals at $174 million. Spending on concentrates is expected to hit $140 million, followed by tinctures at $116 million and capsules at $114 million.

Roughly half of likely edible users surveyed by Deloitte say they plan to consume gummy bears, cookies, brownies or chocolate at least every three months.

The global market for alternative cannabis products is expected to nearly double over the next five years, the consultancy added.

Lee doesn't expect these new products to eat into revenues from existing categories in Canada, at least in the early days.

"Over time, in the long term, you may," she said. "But right now, there's too much demand in the market and there's not enough product."

Legal pot retailers, both government and privately owned, have been contending with a shortage of cannabis since legalization last October, but have said the situation has improved in recent months.

For example, the Alberta government lifted its moratorium on new cannabis retail licences, citing an increase in the pot supply.

Deloitte's market estimates for cannabis 2.0 products reflect overall Canadian consumer demand, but realizing the market's full potential too may take some time. Many of the new pot products may not be available, or available in sufficient quality, come October, Deloitte said.

Companies should take a three- to five-year view on the market, said Lee.

"The regulations will need time to settle, even after legalization in October," she said.

While this presents a growth opportunity for companies readying themselves for the next wave of the green rush, it may come at the expense of sales in more established industries.

"Our research is showing that the occasions that consumers use the product, i.e. mostly edibles, overlap a lot with alcohol ... On a limited wallet, there are going to be tradeoffs," Lee said.

As well, consumers view topical cannabis products such as lotions used for ailments such as pain as a potential replacement for other medicinal products, Deloitte's survey showed.

"This could be cause for concern for the traditional pharmaceutical sector, as 45 per cent of current consumers and 48 per cent of likely consumers say they see cannabis topicals as an alternative to prescription medications, not a complement," Deloitte said in the report.

Deloitte surveyed 2,000 adult Canadians online between Feb. 26 and March 11.

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June 03, 2019 at 07:39PM

Apple drops on report that Justice Department is eyeing antitrust probe - CNBC

Apple CEO Tim Cook

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Apple shares ticked lower Monday after a Reuters report saying the Justice Department is considering a probe of the iPhone maker.

The agency has been given jurisdiction to probe the company's practices as part of a broad review into potential anti-competitive behavior among big tech companies, Reuters reported, citing two sources.

The stock fell nearly 2% following the report, after trading higher earlier in the day. Apple and CEO Tim Cook are presenting updates to the company's central software at the annual Worldwide Developers Conference.

The tech-heavy Nasdaq Composite index fell Monday after similar regulatory headlines dinged tech giants Google, Amazon and Facebook.

Earlier Monday, the Wall Street Journal reported that the Federal Trade Commission will examine how Facebook's practices affect digital competition. The Washington Post reported over the weekend that Amazon has come under heightened scrutiny by U.S. regulators. And on Friday, the Journal reported that the Justice Department is preparing a probe of Google, sending shares of parent company Alphabet down more than 7% Monday.

The possible Apple probe is linked to the Google probe, Reuters reported, and stems from meetings between the DOJ and the FTC.

The headlines together paint a daunting picture for Silicon Valley and the stock market's most valuable companies. Big tech has long faced scrutiny from European regulators, but has so far shrugged off calls for government regulation in the U.S.

Apple has drawn increased criticism in recent months for what some — including streaming giant Spotify — see as anti-competitive behavior in the App Store. Apple owns and operates the online marketplace, collecting subscription fees from developers.

The so-called "Apple tax" accounts for a sizable percentage of Apple's burgeoning services revenue segment, but draws the ire of developers who, in some cases, compete with Apple's own apps in the store.

Spotify's EU complaint against Apple, filed in March, is pending investigation by European authorities.

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2019-06-03 18:04:38Z
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