US Markets Plunge, Media Stocks Fall on Jitters Sparked by Brexit

US equities markets opened sharply lower on Friday on the heels of the U.K.'s vote to withdraw from the European Union.

The Dow Jones average was down more than 500 points at the 9:30 a.m. ET start of trading on Friday. Investors were no doubt reacting to the plunge in U.K. and European markets overnight as the reality of the U.K.'s Brexit referendum sunk in. The NASDAQ was off more than 168 points.

Media stocks were not immune to the market's undertow. Discovery Communications, one of many US-based media companies that is banking heavily on international growth, was down more than 5 percent in the first few minutes of trading. 21st Century Fox was down more than 4 percent, as was Lionsgate.

Disney, Time Warner, Viacom, Netflix and CBS Corp. registered declines in the 2 percent-4 percent range. AMC Networks, with the smallest international footprint of the largest media congloms, was mostly spared with only a 1 percent decline in the early going.

The media biz, like most business interests in the U.K., were counting on the vote to fall the other way. Executives are likely to be in a scramble to figure out how the disengagement with the EU will affect their U.K. and European operations.

Another big concern about the fallout from the U.K.-EU divorce is the impact on currency fluctuation rates. The strong dollar has already been putting a dent in Big Media earnings for the past few years at a time when all of the majors are looking to invest more in overseas growth markets. The promise of more volatility to come in currency rates is unwelcome news for Hollywood's majors.

Discovery acknowledged as much in a statement issued Friday morning. The company has already taken steps to shield its downside in the U.K. and Europe with financial instruments that hedge its exposure to big swings for the Pound and Euro by as much as 80 percent of its business activity in those currencies through the end of 2017.

"Discovery Communications respects the decision of the U.K. people in this historic vote to leave the European Union. Discovery Channel first launched in the U.K. in 1989 and since then it has become one of our biggest markets and a critical creative and business hub," the statement said. "As a global company with a significant presence in 220 markets, we are accustomed to operating in an industry and a world where change is constant. We will work closely with U.K. and EU leaders to successfully navigate this change and find new opportunities to shape our future."