Skydance Shares Plunge as Tech Selloff Deepens; Apple Regains $5 Trillion Market Value

Skydance shares fell 22% on Wednesday to close above $7 after the company distributed warrants to investors. Apple shares rose, but tech stocks and broader markets mostly closed lower after September inflation came in hotter than expected, stoking fears of higher interest rates that hit heavily indebted companies hardest. Apple saw […]

Shares of Skydance fell 22 percent on Wednesday to end the session above $7 after the company distributed warrants to investors. Apple shares rose, but tech stocks and overall markets mostly ended lower after worse-than-expected inflation in September fueled fears of higher interest rates that hit heavily indebted companies in particular.

Apple once again saw its market capitalization surpass the $5 billion mark, a level it first reached last July. The stock is up 26% year-to-date and nearly 40% over the past 12 months. Today closed up 0.5% at $343. New CEO John Ternos took over from Tim Cook as CEO on September 1, and investors are cheering for the tech giant, which recently unveiled the Dove foldable iPhone. Apple and Nvidia are the only two companies that have reached the $5 trillion mark. Related News Skydance Stock News Early Days of Deal With Donald Trump Commenting on New Skydance: "They're great people and it's going to be a great company."

Other tech companies went the other way, from Meta (-3.3%), Amazon and Alphabet (both down 1.7%) to Snap (-6%) and Spotify (-0.6%). Shares of Netflix fell, but ended the session a hair (+0.16%) after the company unveiled steep job cuts earlier Wednesday. Watch on Deadline

In the final phase of its media giant merger, Skydance's warrants began trading and, as expected, its stock fell. The warrants, distributed to Skydance shareholders, allow holders to buy shares of stock at a specified price. They trade separately from Class B common stock, which closed down 22 percent at $7.06. Skydance's warrants, which have a 10-year maturity, are exercisable when the stock reaches $12 per share. As of Wednesday, holders of Class B shares were no longer entitled to warrants.

The company announced last week that it would allow public investors access to the warrants ahead of the completion of the merger between Paramount and Warner Bros. Discovery on Oct. 6. About 90 percent of the company's investor base, including Oracle billionaire Larry Ellison and father of Skydance CEO David Ellison, as well as Middle East sovereign wealth funds RedBird Capital and other backers, did not receive warrants.

Oracle shares fell about 9 percent amid a broader slump in shares of AI's top shareholder. Year to date, Oracle shares are down 33%.

The merger and rebranding of Paramount and Warner Bros. Discovery got off to a rough start when it began trading under its new symbol, SKYD. The combined company has a huge debt load of nearly $80 billion. Rising interest rates could make debt more difficult to manage, and Wall Streeters are wary of Skydance's high leverage and its ability to find $6 billion in cost synergies.

As quarterly earnings season begins next week, investors will be looking for strategic clarity from Skydance, Netflix and others.

Annual U.S. inflation rose to 3.7 percent in September, according to the Labor Department's latest consumer price index. which was higher than expected, the increase in energy prices continued, which was caused by the Trump administration's war with Iran. The price of gas increased by 34% compared to the same period last year. Rising inflation will put pressure on the Federal Reserve to raise interest rates again after raising them in September.

The Nasdaq fell 1.9 percent, the Russell 2000 fell 1.9 percent and the S&P 500 fell 1.1 percent. The Dow Jones Industrial Average lost about 50 points. All finished the day off their lows.

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