U.S. financial markets tumbled on Friday, once again extending a rollercoaster ride on Wall Street that sees no signs of ceasing anytime soon.
The Dow Jones Industrial Average fell 201.95 points, to 24,462.94, as Nasdaq was off 91.93 points, to 7,146.13.
Media stocks were awash in a sea of red, but four companies stand out with gains to end the week.
Emmis Communications enjoyed a 17-cent gain, to $4.71. That’s close to the year-to-date high of $4.76 seen on March 19, and points to Emmis’ best Wall Street performance since September 2015.
Concurrently, Entravision Communications saw a much-needed advancement, with a 5-cent jump to $5.10. However, in immediate after-hours trading the stock retreated by giving back that nickel gain from Friday.
The publicly traded stub of iHeartMedia shares improved by 4 cents, to $0.52.
For SBS, a 1-cent gain to $0.44 was seen.
Leading the decliners were Tribune Media (-5%, to $38.83), TEGNA (-5%, to $10.63), Sinclair Broadcast Group (-3.9%, to $29.40), Nexstar Media Group (-3.9%, to $64.45), and CBS Corp. (-3.2%, to $49.33).
Why the drop?
As Bloomberg reports, judges at the U.S. Court of Appeals for the D.C. Circuit have questioned why the FCC reinstated its “UHF Discount” as part of the Free Press v. FCC trial that opened today (4/20).
“One judge on the three-judge panel likened the FCC’s continuing the audience-counting discount, which is based on limitations from an obsolete broadcast technology, to keeping a moribund body on life support,” Bloomberg reporter Todd Shields notes.
Bloomberg Intelligence analyst Matthew Schettenhelm adds that the hearing “went poorly for the FCC,” and that the court could rule unanimously against the Commission.
“Sinclair will likely try to race to close the deal with the discount before the court rules, probably in 3Q,” or by the end of September, Schettenhelm said in a note released Friday by Bloomberg Intelligence.
But, Wells Fargo analyst Marci Ryvicker tells Bloomberg that Sinclair can’t be forced “to unwind the transaction” as the court cannot “force” the FCC to redo its approval of the deal. In fact, Ryvicker intently states, “The outcome should have little to no impact on the merger.”