How could European Commission fines bring down shares of Apple, Google and Meta?

According to the well-known news agency Bloomberg , the largest IT companies Apple, Google and Meta face huge fines.

The European Commission is conducting investigations into violations of digital markets legislation.

Each of the defendants faces their own accusations: Google is accused of promoting its subsidiary services in the search, Apple's App Store rules do not meet DMA requirements, and Meta is accused of introducing fees for using Instagram and Facebook.

If a violation of the rules is confirmed, companies face fines of 10% of their total income.  

So, assuming Google's revenue for 2023 is $300 billion, the fine for that company would be approximately $30 billion. Apple would be fined approximately $40 billion, and Meta could be fined around $12 billion.

How will this situation affect the price of these securities?

Such fines would cause significant damage even to IT giants such as the aforementioned companies. Furthermore, a deterioration in their reputations is expected.

Naturally, in the event of an unfavorable outcome, shares of Apple, Google and Meta could fall quite significantly.

The fines will significantly impact financial performance for 2024, and investors in Apple and Meta will likely have to forego dividends.

In the current situation, one should refrain from purchasing shares of the named companies for now, or speculate on a decline in their price.

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What is the likelihood that the European Commission will approve the fines?

The likelihood of a negative outcome is quite high. The European Union needs additional funding, so if digital dominance is confirmed, the European Commission is unlikely to make any concessions. Moreover, this is not the first precedent for the imposition of such sanctions.

All we can do is wait for news and place pending orders to sell these assets.