The stock market edged lower today, as investors continued to unload biotech stocks en masse. The health care sector started selling off heavily on Friday after reports that three members of congress had grumpily petitioned Gilead Sciences to explain how they priced their product. Wall Street, fearing an industrywide crackdown, promptly unloaded shares of similar companies, and the pessimism didn't stop on Monday. The Dow Jones Industrial Average (DJINDICES: ^DJI ) lost 26 points, or 0.2%, to end at 16,276.
While biotechs were down across the board, three entertainment stocks also made their impact on the market.
Shares of Walt Disney (NYSE: DIS ) finished toward the bottom of the Dow today, losing 1.1%. The largest entertainment company in the world announced the new co-chairman of its TV business, a move Disney made in a hurry after current head honcho Anne Sweeney announced her departure two weeks ago. That said, the way the company distributes its content is a larger issue in the long-term. Disney's seen the light, embracing the shift to streaming by teaming with Netflix (NASDAQ: NFLX ) on a few exclusive deals.
But this relationship with the premier name in web streaming didn't help Disney today, as Netflix stock took a 6.7% dive. Apparently the largest publicly traded company in the world, Apple is in talks with Comcast to offer a streaming service that would directly compete with Netflix. The Wall Street Journal report late Sunday said Apple would offer a set-top box with special treatment from Comcast's cable infrastructure so content wouldn't buffer endlessly or take eons to load. The two companies are only in talks, but the risk is real for Netflix, as evidenced by its sharp decline today.
Finally, shares of Lions Gate Entertainment (NYSE: LGF ) surged 3.8% Monday, as the company's teen-targeting Divergent film performed well in the box office despite negative early reviews from critics. The film pulled in $56 million domestically in its opening weekend, allowing Lions Gate investors to rest easy and relax. Divergent is based on the wildly popular novel of the same name, and is the first installment in a trilogy, so a flop this weekend would've meant dramatically reduced expectations for the future.