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Facebook changes News Feed, investors click on ‘sad’
Posted on 13th January 2018
Shares of Facebook Inc fell more than 4 percent on Friday and were on track for their worst session in more than three months after Chief Executive Mark Zuckerberg announced changes that he said would hit user engagement in the near term. Zuckerberg said late on Thursday the world’s largest social network would adjust its centerpiece News Feed to prioritize what friends and family share, while reducing the amount of non-advertising content from publishers and brands. A warning by Zuckerberg that people could spend less time on Facebook in the short term as a result of the changes sent the company’s stock $8.29 lower to $179.47.

If the stock closes at that level, it would be the biggest one-day decline since September and would shrink the company’s market value by $23 billion, which is more than the total market value of rival Snap Inc, the owner of Snapchat. “There is too much uncertainty relating to the economic impact of Facebook’s pending News Feed changes for us to be comfortable retaining a Buy rating on the stock,” wrote Stifel analyst Scott Devitt in a research note, cutting his recommendation to “hold” from “buy.”

The change announced by Zuckerberg follows criticism that Facebook’s algorithms may have prioritized misleading news and misinformation in people’s feeds, influencing the 2016 American presidential election as well as political discourse in other countries. Facebook said its new ranking system would hurt non-advertising content from publishers and brands, like news stories and viral video posts, but not change the ranking of advertising that has been paid for. That will leave businesses that want publicity on Facebook no choice but to spend more on advertising, and as a result prices will climb, predicted Eric Schiffer, chairman of Reputation Management Consultants, which advises corporate brands on social media.

“They’re definitely going to be required to buy an ad,” Schiffer said. With its stock up 48 percent over the past 12 months, Facebook has been a major driver of a technology rally that has propelled the S&P 500 to record highs. Its revenue is expected by analysts on average to have surged 45 percent in 2017, a rare accomplishment for a company of its size. Some hedge funds used Friday’s drop in Facebook’s stock to bolster their positions, said Joel Kulina, a senior trader at Wedbush.

“Guys were hoping there would be more of a pullback so they could buy more,” Kulina said. “They don’t think there are any real cracks in the Facebook story.” Changes to Facebook’s News Feed may have an impact on major suppliers of news and other content. John Ridding, the chief executive of the Financial Times, warned on Friday that the domination of online advertising revenue by search and social media platforms was putting pressure on media firms.

“The FT welcomes moves to recognize and support trusted and reliable news and analysis. But a sustainable solution to the challenges of the new information ecosystem requires further measures,” he said.

Other Latest News
 
New Delhi: The government will set up a $350 million solar development fund for financing solar projects, New and Renewable Energy and Power Minister Raj Kumar Singh said on Thursday.

Over the years, the minister said, renewable energy has become cheaper and is set to replace conventional energy, which is a healthy development.


 
Idea Cellular has announced its new ‘Magic Cashback Offer’ that will get users a cashback of up to Rs 3,300 on the purchase of Rs 398 pack or higher. Idea’s Magic Cashback offer will take on Jio offer, which was refreshed earlier this week, to offer ‘More than 100 percent cashback’ on the same recharge value of Rs 398 or higher. Although, Idea’s new offer has the same benefits as the ones given by Reliance Jio earlier.

 
German luxury carmaker Audi on Thursday launched an all-new version of its premium SUV Q5 priced at Rs 5.3 million (Rs 53.25 lakh) (ex-showroom Delhi).

The model would be available in two variants priced at Rs 5.3 million (Rs 53.25 lakh) and Rs 5.7 million (Rs 57.6 lakh).


 
NEW DELHI: The Indian men's hockey team put on a fighting performance but it wasn't enough for them to prevent a 0-2 against Belgium in the third match of the Four Nations Hockey Tournament in Tauranga on Thursday. Arthur De Sloover and Victor Wegnez scored in the eighth and 34th minute respectively to help Belgium win and overcome the 4-5 loss suffered at the hands of New Zealand on Wednesday.

Axis Bank ups loan rate by 5 basis pts
Posted on 18th January 2018
 
Axis Bank, the country's third largest private sector lender, hiked its lending rates on Wednesday by a marginal 5 basis points (100bps = 1 percentage point). The bank informed the stock exchanges that it has increased its benchmark marginal cost of lending rate (MCLR) by 5 basis points across all tenures with effect from January 18. The one-year MCLR, at which rate its home loans and other important products are priced, will now stand at 8.30%, the bank said.

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