Dow falls 355 points; Viv U hit hardest
NEW YORK — Stocks tanked and showbiz shares drooped Tuesday as investors, back from a long — and rainy — holiday weekend, fretted over a tepid economy.
The Dow Jones Industrial Average plunged 355 points, or more than 4%.
Among media congloms, Vivendi Universal was hit the hardest, falling 9.57% to $11.72.
Walt Disney dropped 6.06% to $14.73 and Viacom was down 4.5% to $38.86.
AOL Time Warner fell 4.43% to $12.09. CS First Boston, which relaunched coverage of entertainment stocks Tuesday, left AOL TW unrated, citing a number of unresolved issues at the giant conglom like SEC and DOJ investigations, management turnover and slowing growth at America Online.
News Corp. eased 2.98% to $20.82.
Wall Streeters cited a plunge in Japanese markets overnight and U.S. economic stats Tuesday morning showing the manufacturing sector is weaker than anticipated. They’re also jittery at escalating talk of an attack on Iraq and nervous about the Sept. 11 one-year anniversary next week.
“People showed up at work and said, ‘The weather was crappy and I’m going to sell,’ ” joked media fund manager Harry DeMott of Gothic Capital Management.
Generally, a cocktail of fears seems ready to take the wind out of media stocks every time there’s a glimmer of hope that an ad uptick might buoy the sector.
And September is generally a nasty month for stocks, as investors rebalance portfolios.
“Traditionally, September has been the worst month and unfortunately that tradition is being upheld,” said John Tinker of Blaylock & Partners.
October is the second worst. That means little relief is likely any time soon from the volatility, and negativity, that’s characterized trading this year.