Lyft, DoorDash stocks sink toward record lows, Uber falls more than 8% after new labor rules proposed on classifying independent contractors

Shares of ride-sharing companies suffered a beating Tuesday, after the U.S. Labor Department said it would revisit rules that designate whether workers are classified as employees or independent contractors. Uber Technologies Inc.’s stock UBER, -8.65% dropped 8.3% in morning trading, putting it on track for the biggest one-day selloff since May 9, while Lyft Inc. shares LYFT, -9.25% tumbled 10.5% toward a record low. Shares of delivery app DoorDash Inc. DASH, -6.33% sank 6.7%, also toward a record low. Meanwhile, the S&P 500 SPX, -0.11% fell 0.5%. The Wall Street Journal reported that the Biden administration’s proposed new rule, which would replace a Trump-era rule, would rely on an economic-reality test to determine whether a worker is really in business by themselves, whether they perform managerial duties, how they are supervised and whether they are able to set prices.