Shares of Big Tech companies took a hit Monday after a surge in coronavirus cases renewed fears of a global economic slowdown.
Apple, Facebook, Amazon, Microsoft and Google-parent Alphabet — the five most valuable U.S. companies by market cap — collectively lost more than $238 billion in value as part of a broader market plunge, spurred by news that the coronavirus outbreak is spreading rapidly outside China in countries such as South Korea, Iran and Italy. These five tech companies make up nearly one-fifth of the value of the S&P 500, which itself closed down 3.4%.
U.S. stocks on Monday plunged after South Korea raised its coronavirus alert to the “highest level.” Italy also reported a steep increase in confirmed cases. The flu-like coronavirus, named COVID-19, has affected nearly 80,000 people globally, though most of those cases are found in China.
Apple has the largest exposure to China, as it relies heavily on Chinese manufacturing plants for its top products and on Chinese consumers to buy iPhones. The company warned last week that it does not expect to meet its own guidance for the March quarter because of the impact from the coronavirus. The other companies have a smaller presence there, with Google and Facebook basically absent from China entirely, but were hit equally because of broader fears of the outbreak’s effect on the global economy.
The move follows share declines for Big Tech on Friday. Dow-component Microsoft fell more than 3%. Facebook, Amazon, Alphabet and Apple all closed at least 1.5% lower to drag the Nasdaq down.