Music Stocks Fall in Chaotic Week for Markets

Only four of the twenty stocks were in Billboard’s Global Music Index were in positive territory this week: Spotify climbed 4.5% to $127.09, Tencent Music Entertainment rose 4.4% to $7.85, Warner Music Group increased 1.5% to $30.21 and Reservoir Media improved 0.2% to $6.15.

Problems in the banking sector caused another panic this week. Signature Bank and First Republic collapsed this week after a run at Silicon Valley Bank. Credit Suisse needed the support of Swiss National Bank Wednesday, after its largest shareholder refused to inject funds to ensure stability. After falling 1.2% Friday (17 March), the Dow Jones Industrial Average dropped 0.1% this week. The S&P 500 improved 1.4% on the week despite falling 1.1% on Friday.

Despite stocks falling in negative territory, the Global Music Index dropped 0.4% to 1,188.02 Spotify and Warner Music Group were two of the top-ranked companies in the index. Other large companies saw small drops: Universal Music Group fell 1.7% to 21.38 euro, SiriusXM dropped 0.8% to 3.64, and Live Nation fell 0.4% to $66.36.

K-pop company SM Entertainment lost the most, dropping 23.5% from 113,000 won to 113,000 won. This was after HYBE canceled their bid to acquire the company. Last week, SM Entertainment was the Global Music Index’s biggest gainer, improving 14.4% to 147,800 won, after Kakao announced a tender offer to acquire up to a 35% stake from minority shareholders at 150,000 won per share. 

The soft advertising market continued to be a problem for radio companies’ stocks. iHeartMedia fell 12% to $4.31, and Audacy dropped 12.5% to $0.14. Morgan Stanley analysts cut the price target for iHeartMedia to $5 from $8 due to “concerns regarding the long-term growth potential of broadcast radio,” according to a March 16 investor note. Year to date, iHeartMedia’s decline is 29.7%; Cumulus Media is down 35.9%, Audacy has fallen 39.1%. 

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