NEW YORK -- Big media companies led the stock market lower Thursday as investors fretted over fading revenue from cable television. Viacom and 21st Century Fox were among the hardest hit.
Major indexes headed higher in the first few minutes of trading before pulling a U-turn. The selling gained momentum until the afternoon, when the indexes recovered some of their losses.
The Standard & Poor's 500 index fell 16.28 points, or 0.8 percent, to 2,083.56, and the Nasdaq composite lost 83.50, or 1.6 percent, to 5,056.44. The Dow Jones industrial average fell 120.72, or 0.7 percent, to 17,419.75, the sixth day in a row the Dow has finished with a loss.
Walt Disney and other media giants sank after signs that more people are canceling their cable TV. Viacom, the company behind Comedy Central and Nickelodeon, reported Thursday that its sales and profit fell in the most recent quarter. MTV's owner, 21st Century Fox, also reported a drop in television revenue. Viacom's stock plunged 14 percent, and 21st Century Fox lost 6 percent.
"You don't usually see media names move like this," said Rob Eschweiler, a global investment specialist at J.P. Morgan Private Bank in Houston.
Over the past month, the market has been in the habit of making gains one week and losing them all the next. "We've been moving nowhere fast," said Terry Sandven, senior equity strategist at U.S. Bank Wealth Management in Minneapolis. "The market just lacks any direction."
Among other companies in the news, Keurig Green Mountain plummeted 30 percent, the biggest drop in the S&P 500, after reporting falling sales of its packaged coffee and brewing products. The company said it plans to lay off 5 percent of its workforce in a bid to cut costs. Its stock dropped $22.31 to $52.67.
With the bulk of big companies already handing in results, analysts project that second-quarter earnings at big U.S. companies edged up 0.2 percent, according to S&P Capital IQ. Though meager, it's much better than the 4 percent drop analysts had forecast a month ago.
Investors are looking ahead to the Labor Department's monthly jobs report. Economists forecast the government report today will show employers added 225,000 jobs and the unemployment rate held at 5.3 percent for the second-straight month.
Major markets in Europe ended with slight losses. Germany's DAX lost 0.4 percent, while both France's CAC 40 and Britain's FTSE 100 slipped 0.1 percent.
U.S. government bond prices rose, pushing the yield on the 10-year Treasury note down to 2.22 percent from 2.27 percent the day before.
The price of oil fell near its low for the year as a Goldman Sachs report predicting that oil prices would be "lower for longer" reinforced concerns that have driven oil lower over the past six weeks. U.S. crude fell 49 cents to close at $44.66 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 7 cents to close at $49.52 in London.
Business on 08/07/2015