The stock market experienced a significant sell-off on Monday, with major media and tech companies taking a hit as investors expressed concerns about a potential U.S. recession. The Dow Jones Industrial Average dropped 2.6%, shedding over 1,000 points, while the S&P 500 and Nasdaq Composite also saw declines of 3.0% and 3.43%, respectively. This downward trend followed similar drops in Asian and European markets and was exacerbated by the recent U.S. jobs report, which indicated slower hiring and rising unemployment levels.
Among the media companies affected by the sell-off were Warner Bros. Discovery, Paramount Global, Netflix, Disney, and Comcast, all experiencing declines in their stock prices. Similarly, large-cap technology stocks such as Apple, Alphabet, Amazon, and Meta also saw decreases in their share prices. Apple faced additional pressure after Warren Buffett’s Berkshire Hathaway disclosed selling nearly half of its stake in the company during the second quarter. Alphabet, the parent company of Google, faced a setback in an antitrust case where a judge ruled that Google had abused its monopoly position in the search market.
Despite the initial steep losses, many U.S. stocks managed to recover slightly by the end of the trading session. However, concerns lingered, particularly for Disney, as Morgan Stanley analysts lowered earnings estimates for the company due to worries about its theme parks business. Disney is set to report its earnings for the June quarter on Wednesday, and analysts are closely monitoring the performance of its parks division. The note issued by Morgan Stanley highlighted a more cautious view on Disney’s parks business for FY25, with adjustments made to earnings estimates for both FY25 and FY26.
Overall, the sell-off in stock markets on Monday reflected broader economic uncertainties and investor anxieties about a potential recession. Media and tech companies, in particular, faced challenges as market conditions shifted. As the situation continues to evolve, investors will be closely monitoring earnings reports and market developments to gauge the impact on these industries and the broader economy.