Silicon Valley Targeted
Antitrust scrutiny rattled Big Tech. Regulators split up oversight in apparent preparation for probes into whether the firms’ practices harm competition. The FTC will look at Facebook and Amazon as the DOJ examines Google, people familiar said. The Justice Department will also oversee Apple, Reuters reported. Google parent Alphabet fell to a five-month low and Facebook plummeted 7.5%, the most since July. Amazon and Apple also fell.
Futures in Japan, Australia and Hong Kong showed modest gains despite a general U.S. equities selloff. The Nasdaq-100 Index extended losses from a record in May to more than 10% as the FAANG cohort of tech companies was said to potentially face federal probes on antitrust activity. The bond rally marched on, with 10-year Treasury yields dropped to their lowest since September 2017. The greenback lost ground against all of its G-10 peers after James Bullard became the first Fed board member to publicly call for a rate cut amid the trade war. Oil sank and gold jumped.
Another Bad Report Card
Australia’s workplace productivity growth has slowed to a crawl as the economy struggles to shake off the drag from the end of its mining investment boom earlier in the decade. The labor productivity rate declined to 0.4% in year through June 2018, compared with an average of 2.2% since the mid-1970s, the Productivity Commission said. “The current weakness in labor productivity can be partly attributed to a marked slowdown in investment in capital,” the commission said. It’s not all bad — Australia is still performing well in maintaining productivity levels when compared with other developed economies.
China’s Warning to Students
China warned its students and scholars to consider the risks before studying in the U.S., following Washington’s recent restrictions on Chinese students. The Education Ministry pointed to extended reviews and shorter validity of visas, and an increased refusal rate. American universities still welcome Chinese, a ministry spokesman told CCTV. Still, several Chinese graduate students and academics told Bloomberg News in recent weeks that they found the U.S. academic and job environment increasingly unfriendly.
Donald Trump kicked off his U.K. state visit, saying a trade deal was possible once Britain “gets rid of its shackles” by leaving the EU. The president met Queen Elizabeth at Buckingham Palace, with protesters outside. He also took time to call London Mayor Sadiq Khan a “stone cold loser” and complain about CNN’s coverage of his visit by suggesting a boycott of owner AT&T.