AMC stock price slips 6% after drawing backlash on optional mask wearing
- Earlier this week AMC said it won’t require but encourage mask wearing in its theaters
- The theater chain has reversed its policy after drawing a backlash from the public
- AMC stock price dropped over 6% after failing to keep its head above the $7.00 mark
Shares of AMC Entertainment (NYSE: AMC) slipped over 6% last week as the stock continues to trend lower following a failure to clear the resistance around the $7.00 mark. Separately, AMC decided to change its policy on guests wearing masks after facing a backlash from the public.
Fundamental analysis: AMC to require face masks
AMC Entertainment, the largest movie theater in the world, has been forced to reverse its mask policy after drawing a backlash from the public. The theater chain will now ask all its guests to wear masks at all of its U.S. movie theaters, once they open in July.
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“At AMC Theatres, we think it is absolutely crucial that we listen to our guests,” AMC Chief Executive Adam Aron said in a statement.
“It is clear from this response that we did not go far enough on the usage of masks. As we reopen theatres, we now will require that all AMC guests nationwide wear masks. The speed with which AMC moved to revise our mask policies is a reflection of our commitment to the safety and health of our guests.”
Two days ago, AMC said it won’t require but encourage mask wearing in the states where the official policy doesn’t require it. Accordingly, AMC didn’t want to cause the “political controversy” by forcing people to wear masks inside movie halls.
“We did not want to be drawn into a political controversy. We thought it might be counterproductive if we forced mask wearing on those people who believe strongly that it is not necessary,” Aron said.
This stance drew harsh backlash from the public, including actor Elijah Wood.
AMC aims to reopen 450 theaters in the United States on July 15. The theater chain is expected to screen its blockbusters – Walt Disney Co’s “Mulan” and Christopher Nolan’s “Tenet” – on July 24 on July 31 respectively.
Invezz reported last month that the e-commerce giant Amazon showed interest in acquiring AMC Entertainment.
Technical analysis: Stock price slips 6%
AMC stock price closed the week over 6% in the red to record the second consecutive week in which the buyers failed to close on a positive note. Last week, shares of AMC rallied to print a 3-month high at $7.35, before rotating lower and closing below the $7.00 handle.
The area around $7.00 hosts three important resistance levels – the horizontal resistance and two descending trend lines. The sellers will be now targeting a move towards the 100-DMA at $4.75.
AMC Entertainment stock price fell over 6% in the last week after the bulls failed to stay above the $7 mark. In the meantime, AMC reversed its earlier policy on masks and it will now require all guests to wear masks inside its theaters.
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