UPDATED with closing prices: Shares of Twitter fell more than 10% in early trading after the social media platform banned President Donald Trump permanently Friday for risk of inciting violence, but had regained some ground by late morning as heat around Internet regulation ratcheted up.
The stock closed at $48.97, down 4.87% on jitters that the company could lose audience share and advertising with out its poster-in-chief.
“We have always wondered how much of Twitter’s growth came from the ‘Trump Bump’ when the leader of the free world took to Twitter to threaten North Korea’s dictator, rip the monetary policy of his Fed Chairman, insult the acting talents of Meryl Streep or challenge the outcome of the 2020 U.S. elections. Now we will find out,” wrote analyst Michael Nathanson of MoffettNathanson.
Twitter’s move started after Trump egged on supporters at a rally Wednesday, reiterating false claims the election had been stolen. A mob then violently trashed the Capitol building resulting in five deaths as lawmakers attempted to ratify president-elect Joe Biden’s electoral college victory.
The markets last week mostly shrugged off the chaos. On Monday, the DJIA had slipped 0.26% and the tech heavy Nasdaq was off 0.68%, with social media stocks down more than most. Facebook, which also banned the president indefinitely but at least through the end of his term, fell 1.89%. Apple, Google and Amazon, which stopped supporting the smaller, alt-Twitter platform Parler, were trading down, respectively, 1.75%, 1.63% and 1.18%. Parler today sued Amazon.
Trump had 88 million Twitter followers and the service had been his main communication conduit throughout his presidency. Moves by Twitter, Facebook and YouTube to moderate content grew increasingly controversial leading up to and after the election — with right side of the aisle crying bias and the left insisting that any measures that were taken were not sufficient. Lawmakers called CEOs to testify at a series of hearings and executives have appeared increasingly uncomfortable with the role of public policing. Facebook CEO Mark Zuckerberg has said on various occasions that he would not be opposed to some government regulation on how the industry operates.
That’s a kind of model followed in Europe. German Chancellor Angel Merkel weighed in on the issue Monday, criticizing Twitter’s decision to ban Trump as a breach of “the fundamental right to free speech,” according to the Financial Times. She told the publication through a spokesman that she believes the government should be the one to set some restrictions on social media. In the U.S., just about the only specific law in place regarding the platforms deal with online sex trafficking. Europe has a more robust set of norms that include sweeping online privacy rules under the General Data Protection Regulation (GDPR) enacted in 2016.
Twitter initially said that it would keep the @POTUS account active but would continue to monitor it. Within minutes after posting, Trump’s tweets disappeared from that account, too. Twitter said that they violated rules that prohibit using another account to evade suspension.
Trump had posted a message on @POTUS, blasting the platform for banning @realdonaldtrump and vowing, “We will not be silenced!” He also said they are “negotiating with “various other sites,” and even looking at the possibilities of “building out our own platform in the near future.”
Facebook, Google and Microsoft said separately they were pausing all contributions for their political action committees as they review policies in the wake of the Capitol invasion last week. WarnerMedia parent AT&T and a host of other companies across industries said they decided to suspend contributions to members of Congress who voted to object to the certification of Electoral College votes last week.
Trump hasn’t been heard from publicly since his latest Tweets but is said to be planning a visit to the town of Alamo, Texas tomorrow to mark completion of 400 miles of border wall.
The House is giving Vice President Mike Pence to invoke the 25th Amendment to remove the president. If there’s no movement on that, they’ve drawn up articles of impeachment for a vote on Wednesday. The Senate is not in session.