Netflix Plunges As US Stocks Open Lower Again

Muhammad Irfan Published January 21, 2022 | 10:13 PM

Netflix shares dove more than 20 percent Friday following a disappointing forecast for subscriber growth for the streaming service, as US stocks retreated again at the start of the final session of a bruising week

New York, (APP - UrduPoint / Pakistan Point News - 21st Jan, 2022 ) :Netflix shares dove more than 20 percent Friday following a disappointing forecast for subscriber growth for the streaming service, as US stocks retreated again at the start of the final session of a bruising week.

The travails of Netflix and of Peloton -- another beneficiary of the so-called "pandemic trade" -- weighed especially on the tech-centered Nasdaq, which suffered the worst losses of the major indices.

About 35 minutes into trading, the Nasdaq was down 1.3 percent at 13,971.36. The index has dropped more than six percent this week.

The Dow Jones Industrial Average shed 0.2 percent to 34,632.15, while the broad-based S&P 500 lost 0.8 percent at 4,446.33.

Stocks have been under pressure all week as investors question lofty valuations scored at the end of 2021 amid a sharp pivot by the Federal Reserve away from extreme accommodation and towards tighter monetary policy, which is expected to soon bring higher lending rates.

Adding to this has been a reranking by investors of some companies that prospered earlier the pandemic when consumers were stuck at home.

Netflix shares fell 23.7 percent as it projected it would add only 2.5 million subscribers in the first quarter of 2022.

The company behind "Squid Game" and "The Crown" pointed to the "ongoing Covid overhang and macro-economic hardship in several parts of the world." Netflix also alluded to rising competition from the likes of HBO Max and Disney+.

Meanwhile, Peloton Interactive rose 4.2 percent after slumping nearly 25 percent Thursday following a report that the fitness firm planned to suspend production of bikes and treadmills due to falling consumer demand.

In a memo to employees late Thursday, Peloton CEO and founder John Foley called the reports "false," but said "we are resetting our production levels for sustainable growth."