Big Media, Cable Hurt in Stock-Market Dive
Stock market gives back Friday's gain but many broadcasters relatively unscathed.
By Robert Marich -- Broadcasting & Cable, 9/22/2008 1:08:00 PM
As many broadcasters escaped the worst of the downdraft, the stock market took another tumble Monday, giving back Friday’s gain and continuing the see-saw volatility that stretches back to Sept. 15.
The Dow Jones Industrial Average fell 372.75 points to close at 11,015.69. That’s a steep 3.27% drop versus Friday’s 3.35% gain.
On Monday, the price tag of the federal-government bailout of U.S. credit markets spooked investors and led to a spike in oil prices, since the bailout looks to weaken the U.S. dollar, in which oil contracts are denominated.
Big-capitalization media/entertainment stocks were hard-hit. Rupert Murdoch-led News Corp., parent of Fox Broadcasting, declined 6.8%. Time Warner dropped 4.5% and Disney fell 4.3%.
Stocks that are interest-rate-sensitive got punished, including cable-system operators that carry heavy debt loads. Cablevision Systems fell 6.4%, Comcast class A dropped 4.0 and Time Warner Cable slipped 3.7%.
Basic-cable-network operators, which shoulder less debt, declined to a lesser extent, such as Crown Media, parent of Hallmark Channel, which was off just 0.38%.
In broadcasting, Nexstar Broadcasting Group actually rose 2.7% and CBS fell just 1.9%. However, Entravision Communications’ 9.9% plunge and Gray Television’s 5.4% decline exceeded those of the broad stock market.
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