Planet Fitness dancers perform on treadmills outside the New York Stock Exchange after the company’s IPO, Thursday, Aug. 6, 2015. A major sell-off in media equities following disappointing earnings reports from Viacom and 21st Century Fox pushed US stocks lower Thursday, with the biggest hit taken by the Nasdaq. AP PHOTO/RICHARD DREW
NEW YORK–A major sell-off in media equities following disappointing earnings reports from Viacom and 21st Century Fox pushed US stocks lower Thursday, with the biggest hit taken by the Nasdaq.
The tech-rich Nasdaq Composite Index slid 83.50 points (1.62 percent) to 5,056.44.
The Dow Jones Industrial Average dropped 120.72 (0.69 percent) to 17,419.75, while the broad-based S&P 500 shed 16.28 (0.78 percent) at 2,083.56.
Viacom, which owns Nickelodeon and Comedy Central, plunged 13.4 percent as third-quarter revenues dropped 10.6 percent to $3.06 billion, below the $3.29 billion analyst estimate.
Fox fell 6.4 percent after reporting that earnings for the quarter ending June 30 sank 91 percent to $87 million.
The weak media results exacerbated worries that increased viewing on smartphones and other gadgets will hammer the cable business.
Disney fell 1.8 percent and Time Warner dropped 0.8 percent, adding to big declines Wednesday following their earnings reports.
“The destruction in the media space the last two days has been very unnerving,” said Michael James, managing director of equity trading at Wedbush Securities.
James said investors were also cautious ahead of Friday’s US jobs report for July, which has the potential to cause more volatility.
Tesla Motors tumbled 8.9 percent as it reported a second-quarter loss of $184 million and forecast deliveries of 50,000-55,000 electric cars in 2015, down a bit from the previous projection of 55,000 deliveries.
Keurig Green Mountain coffee company plummeted 29.8 percent after reporting that third-quarter sales fell 5.2 percent to $969.6 million. The company said it would cut five percent of its workforce.
Petroleum-linked stocks, which have underperformed the broader market in 2015, had a generally good day. Dow members ExxonMobil and Chevron rose 1.2 percent and 1.4 percent, respectively, and Anadarko Petroleum advanced 2.9 percent.
Food giant Mondelez International gained 1.1 percent as activist fund Pershing Square Holdings said it had amassed a 7.5 percent stake in the maker of Oreo Cookies. Pershing said in a filing that it would engage Mondelez officials on strategic plans, including potential mergers and divestitures.
Solar company SunEdison sank 25.3 percent as it reported a second-quarter loss of $263 million, or 93 cents per share, much worse than the 55-cent loss projected by analysts.
Bond prices rose. The yield on the 10-year US Treasury fell to 2.22 percent from 2.27 percent Wednesday, while the 30-year dipped to 2.89 percent from 2.94 percent. Bond prices and yields move inversely.