News Corp’s Rupert Murdoch (left) and chief executive Robert Thomson (right) at a press conference in August. Photo: Simon O’Dwyer Twitter shares spiked last night.
Here’s another great example of just how skittish markets are these days.
Media giant News Corp was overnight forced to deny vague market rumours that it was going to buy, or had already bought, a stake in Twitter.
The rumour, which was – among other news outlets – reported by News Corp’s very own Marketwatch site, lifted shares in Twitter, the beleaguered social network, by as much as 14 per cent.
The stock retreated following the denial, but still finished the regular trading session on the New York Stock Exchange about 4 per cent higher.
That News Corp would at least consider buying a stake in Twitter – whose shares are trading near their lowest levels since listing in 2013 – is not entirely implausible. After all, the company dropped $US580 million on MySpace – a kind of forerunner to Facebook, back in 2005 (although it sold the business for just $US35 million in 2011, and later described the investment as a “huge mistake”).
Also, don’t forget News Corp’s billionaire boss, Rupert Murdoch is clearly a fan of the service. He’s a prodigious tweeter, having posted his most recent tweet just five hours before publication of this story. Obama says Australia second biggest anti-iSIS fighter. So where the heck are NATO partners?— Rupert Murdoch (@rupertmurdoch) January 20, 2016
Yet alas, any Twitter investment is clearly not happening. ” The rumour is untrue,” a New York-based representative for News Corp told Fairfax categorically.
These types of shady rumours tend to emerge when companies are struggling, and for Twitter that is certainly true. Its stock has tumbled more than 50 per cent over the past year – amid investor concerns over its the lack of growth in its user base. Twitter has 320 million monthly active users, compared to 1.5 billion for the social media behemoth Facebook.
To add to its woes, Twitter suffered a widespread outages on Tuesday, rendering millions of users across the globe unable to access the service.