Monday marked a wild ride for the major U.S. stock indexes as the markets opened with an alarming plunge, and then rallied back to pare most of those losses before sinking again in the final hour of trading.
Media stocks were buffeted by the volatility, with the top entertainment conglomerates on a roller-coaster ride of losses and gains throughout the trading day. The situation was so unpredictable that ABC and NBC broke into regularly scheduled daytime programming with news bulletins on the opening numbers, and NBC followed with an update at 4:01 p.m. ET after the closing bell.
In the end, the Dow finished the day down 588.47 points, or 3.58%. The Nasdaq sank 179.79, 3.82%.
After opening with a more than 1,000-point drop, the Dow recovered significantly by 1 p.m. ET to come within 1% of its closing levels on Friday, which was also a volatile day for Wall Street. But by 3 p.m. ET, the Dow was down 500-plus points again, or around 3.3%. The Nasdaq was on the same seesaw and was back to a 170-plus point drop by 3 p.m. ET.
Wall Streeters chalked up the turbulence as driven by a long overdue correction after a four-year rally. The panicky selling environment in the U.S. was also sparked by turmoil in Europe and China stock markets before U.S. trading began. Signs of a slowdown in China’s economy have investors worried about ripple effects throughout global markets.
The media sector couldn’t avoid the massive selloff, even Wall Street darling Netflix. Shares of the netcaster tumbled more than 10% in early trading. The stock made up all of those losses by early afternoon but closed the day down nearly 7% to $96.88.
By early afternoon, media companies had made up most of that lost ground amid the market rally, which included a more than 800-point gain for the Dow. Netflix, Disney and CBS Corp. at one point were up slightly over Friday’s close. But in the final hour of trading, shares of showbiz’s major concerns were all in negative territory.
At the close of trading, Viacom was down 4.3% to close at $38.15. Comcast fell 4.1% to close at $54.41. Time Warner lost 4% to $69.81 and Fox eased 3.8% to $26.85. Discovery took a 3.9% hit to $26.05. Disney slid 3.5% to $95.36. CBS Corp. held the decline to 2.5%, to $43.95.
Carmike Cinemas, Discovery, Regal Entertainment, Apple, Twitter and Dish were among the companies that fell to 52-week lows during the day. Bucking the trend, DreamWorks Animation ended the day flat at $19.08.
Media stocks have been beat up in recent weeks amid concerns that the cable business is losing ground to video streaming services like Netflix and that ad rates will continue to decline.
The latest hemorrhaging has more to do with the global economy. Investors have been concerned since China devalued its currency earlier this month — a signal that a huge and growing buyer of American wares might be slowing down. The pain quickly spread as markets in Europe, Japan and India all opened down.
On Monday ,China’s stock markets continued to plummet and local media companies like Enlight Media, Zhejiang Huace and Wanda all took a hit.