Thursday morning brought a brief break in the stock market's gains, as investors reacted ambivalently to reports that the long-awaited trade summit between President Trump and Chinese leader Xi Jinping might not happen as early as expected. As of 11:30 a.m. EDT, the Dow Jones Industrial Average (DJINDICES:^DJI) was down just 6 points to 25,697. The S&P 500 (SNPINDEX:^GSPC) lost 2 points to 2,809, and the Nasdaq Composite (NASDAQINDEX:^IXIC) was off a single point to 7,642.
As important as trade has been to the health of American businesses, other concerns have also had an impact on some well-known companies. Facebook (NASDAQ:FB) added some more challenges to its already long list of obstacles to overcome, while Tesla (NASDAQ:TSLA) is getting ready for the rollout of its newest planned electric vehicle.
Check out the latest earnings call transcript for Facebook.
Facebook deals with outage, investigation
Shares of Facebook dropped 2% as the social media giant handled new problems on a couple of fronts. First, the service encountered serious problems throughout much of the day on Wednesday, raising questions about Facebook's ability to handle current traffic levels. At the same time, an investigation from federal prosecutors appears to be the latest in a series of legal and regulatory issues that the social media company has encountered lately.
Facebook's outages continued across parts of its network on Thursday, with users complaining that problems for Instagram, WhatsApp, and the namesake Facebook app kept them from getting consistent access. The company's tech problems covered several parts of the world, including portions of the U.S., Europe, and South America. The episode highlighted both the demand that customers still have for the service as well as the challenges of keeping the platform up and running.
Meanwhile, investigators are looking at Facebook's agreements with fellow technology companies to share personal information and data, with an eye toward revealing whether those agreements violated the privacy rights of users. Facebook has already had to pay fines related to its data practices, but this latest development could prove even more serious for the company and its investors.
Tesla readies another SUV
Tesla shares were up less than 1% Thursday morning, just hours ahead of the much-anticipated unveiling of the Model Y electric sport utility vehicle. Investors have anxiously looked forward to Tesla's newest SUV offering, because the vehicle class has gained a lot of traction both in the U.S. market and abroad. Tesla does already offer its Model X SUV, but just as the Model 3 sedan gave Tesla a lower price point for customers interested in regular cars, the Model Y should be less expensive than the Model X and be aimed at the mass auto market.
There haven't been a lot of details about the Model Y, but Tesla CEO Elon Musk suggested that the SUV would be about 10% more expensive than a Model 3 while having slightly less range for a comparable battery system. That implies a Model Y price of $38,500, based on the latest price reduction to $35,000 for the Model 3. What investors hope is that production of the Model Y will be able to gain a lot of synergy from Model 3 production, with Tesla using many of the same parts and components in building both vehicles.
One thing the Model Y event should do is draw some attention away from Musk's ongoing battle with the U.S. Securities and Exchange Commission, which has flared up recently in light of continued controversial comments from the Tesla executive. Shareholders would prefer to see a nice pop for the stock as well, which has lost ground in 2019 amid broader fears about the business.