Investors came back from the weekend in a foul mood, and they took out their aggressions on the stock market. Although other market benchmarks fell more sharply, the Nasdaq Composite (NASDAQINDEX:^IXIC) still lost considerable ground to begin the new week. As of noon EDT on Monday, the Nasdaq was down 1.5%, while the Dow had fallen more than 800 points.
Electric vehicle companies have been especially prominent in investors' minds lately, and that made today's news from electric truck specialist Nikola (NASDAQ:NKLA) even more important to the auto industry and the broader investment community. Meanwhile, Roku (NASDAQ:ROKU) scored a big win that sent its shares soaring even in a down market.
A surprise departure at Nikola
Nikola shares plunged 20% Monday morning after an announcement just about no one expected. Founder Trevor Milton has resigned from his position as chairman of the board of directors and will no longer serve on the board.
Milton said the move was voluntary and was motivated by the desire to keep investors' focus on the auto company and not on himself personally. Moreover, Milton is confident that former General Motors (NYSE:GM) vice chairman Stephen Girsky will do a good job in filling his shoes as new board chair.
Nikola's founder also had kind words for the company's executive team. He expressed his confidence that CEO Mark Russell and CFO Kim Brady will be able to help Nikola become the global leader in the fast-growing industry.
Despite Milton's assurances, though, the decision to leave will only heighten investor concerns about allegations that a short-selling investor's report made against Nikola. Until those issues get resolved, it's likely that a cloud will remain over Nikola's stock.
Roku makes a deal
Elsewhere, shares of Roku soared 16%. The connected-TV specialist had been under pressure much of the weekend with a key content provider, but a resolution to the issue had investors happy about the outcome.
Comcast (NASDAQ:CMCSA) and Roku had been in negotiations over Roku's rights to stream content from Comcast's NBCUniversal division. NBCUniversal wanted Roku to accept its terms regarding its Peacock streaming-on-demand service to make it part of Roku's streaming lineup. But Roku apparently balked at the terms, prompting NBCUniversal to threaten to take away its content entirely.
The parties didn't disclose the final terms, so it's unclear at this point who got the better end of the deal. But Roku investors seem happy that any deal is in place. Having the most extensive selection of content is important for Roku in competing with other streaming video services, and so keeping NBCUniversal's content was a definite positive.
The media industry is evolving quickly, and Roku has done a good job so far building a vertically integrated business that includes both television equipment and content. Deals like this will be necessary for Roku to keep its edge.