Call it 'in-the-black Monday'
Dow has largest one-day gain ever; Showbiz 50 up 13.5%After eight days of massive losses, stocks roared back Monday, with the Dow posting its largest single-day gain ever: 936.42 points.
The only stock moving lower among the 30 that make up the Dow Jones index was General Electric, parent company of NBC Universal. GE sank 2.3% to $21 on Monday and is down 41% this year.
GE notwithstanding, as good as the entire market was Monday, media stocks were even better, with The Hollywood Reporter Showbiz 50 index climbing 13.5%. By comparison, the Dow was up 11.1%, the S&P 500 was up 11.6%, and the Nasdaq climbed 11.8%.
Wall Street's big day was sparked by news that the U.S. Treasury could buy stocks in some banks and that governments worldwide are moving to shore up banking systems.
Before Monday, the Dow had lost nearly 2,400 points in only eight trading days, and the index was down 40% from its record high a year ago, twice as much as needed to qualify as a bear market.
According to Bloomberg, the Dow last week suffered its biggest% loss ever when it sank 18.2% in five days. Bloomberg noted that the previous time markets sold off so much so quickly -- losing 36% over two months in 1987 -- they took nearly two years to recover completely.
On Monday, only two stocks in the Showbiz 50 were down: Liberty Media Interactive's Series B shares lost 6%, and Belo Corp. was off fractionally.
At the other end, Liberty Media's Series B shares rose 41%, Cumulus Media was up 29%, Viacom rose 26%, Activision Blizzard was up 23%, and Grupo Televisa climbed 21%.
Viacom's surge comes after a profit warning Friday helped sink its shares to multiyear lows.
CBS also lowered its outlook Friday, and on Monday, Caris & Co. analyst David Miller cut his target price on CBS shares from $17 to $7, even while acknowledging they already trade "at disgustingly low levels." On Monday, CBS rose 8% to $8.74.
Viacom and CBS also have suffered from the realization that Sumner Redstone's National Amusements recently sold 7 million shares of Viacom and 17 million shares of CBS.
Other entertainment conglomerates landed between Viacom and CBS on Monday. News Corp. was up 20%, Sony jumped 18%, the Walt Disney Co. climbed 16%, and Time Warner was up 13%.
As of Monday, Disney remained the most valuable media conglomerate with a $50.1 billion market capitalization. Time Warner was next at $37.3 billion, followed by News Corp. ($26.4 billion) and Sony ($25 billion). Viacom and CBS, combined, were worth about $18.9 billion Monday.