Mediaset share price plummets
Weakening ad sales send price down 5%ROME -- Fears of weakening ad sales unnerved Mediaset investors Tuesday, sending the shares skidding 5.1% lower in very heavy trading and helping to trigger a wider sell-off on the Italian Stock Exchange.
Shares in Italy's largest broadcaster traded as nearly 7% lower during midday trading before recovering slightly on a round of bargain hunting. But the loss was still the worst one-day drop for Mediaset this year.
Analysts said worries about Mediaset's sluggish ad sales and concerns about the company's efforts to recast itself as a content provider sparked the selling after ISTAT, the Italian government's statistics office, released figures showing weak economic growth. The shares closed at their lowest point this year: 3.98 euros ($6.21).
The shares narrowly avoided triggering an automatic halt in trading, a mechanism that goes into effect when shares drop 7% in a single session.
"Speculation is that the news for Mediaset could get worse before it gets better," ABS Securities analyst Giacomo Ferdi said.
The Mediaset slide had repercussions in the broader market, where the Media Index retreated 1.6% and the S&P MIB blue chip index contracted 1.7%. Mediaset shares are a major component of both indexes.