In a day that has seen the Dow Jones drop by over 200 points and the NASDAQ take a 50-point dive, Internet companies such as Microsoft and Yahoo have seen their stock prices continue in a downward spiral. Unfortunately, Google’s day hasn’t been much better.
In case you haven’t heard, Viacom sued Google/YouTube today to the tune of $1 billion dollars. As you may have already guessed, that breaking news item didn’t exactly warm the hearts of the company’s stockholders, as evidenced by the 11.72 drop in stock value at the end of today’s trading. That represents a loss of nearly 2.6 percent.
If the Viacom case against Google and YouTube carries any merit, it could open the floodgates for other lawsuits against the company. One then begins to wonder if in turn, the company’s stock prices would continue their slide amid a flurry of litigation. If Google becomes the next big legal target of the major media, will investors look to get out while they still can?
It’s still too early to make such a generalized assumption based on the facts of a single day’s trading. The market as a whole has suffered over the past several weeks, with the Dow and NASDAQ seeing significant single-day losses on more than one occasion. So, the drop in Google’s stock may be less about the Viacom lawsuit and more about the state of the market as a whole.
Google wasn’t the only company to see a drop in stock price at the end of the day’s trading. Microsoft ended up losing just over 2.6 percent, while Yahoo, despite its comeback year thus far on the trading floor, ended the day down 1.43 percent.
