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Nikola’s Nightmare; Microsoft’s $7.5 Billion Bet

US News & World Report -  Money logo US News & World Report - Money 9/21/2020 John Divine

Stocks started the week on the wrong foot on Monday, continuing to struggle in what's proven to be a lousy September on Wall Street.

The anticipated stimulus relief that was a key talking point during the summer rally is now one of the key narratives behind the recent pullback. That's because it's looking less and less likely a major stimulus will come from a divided Congress on the eve of elections.

Gold, crude oil and stocks all fell Monday, with the Dow Jones Industrial Average losing 509 points, or 1.8%, to finish at 27,147.

Microsoft's $7.5 billion gaming bet. Microsoft (ticker: MSFT) announced the $7.5 billion acquisition of game developer and publisher ZeniMax Media, which publishes a number of popular games, including Doom, Fallout, The Elder Scrolls and Wolfenstein.

The deal signals Microsoft's commitment to taking on Sony (SNE), its biggest rival in the console space and will allow ZeniMax games to hit the Xbox Game Pass subscription service.

Nikola's founder resigns. As fraud allegations swirl around the electric truck company Nikola (NKLA), Trevor Milton, Nikola's founder, stepped down as executive chairman. He said he intended to defend himself against what he called "false allegations," but the move was still viewed negatively by Wall Street and the stock fell 19.3% Monday.

The company is under investigation for public statements on its technology and ability to produce its electric truck swiftly, which doesn't yet exist.

Roku jumps. Roku (ROKU) surged, jumping nearly 17.7% on Monday, after reaching a deal with Comcast (CMCSA) to include NBCUniversal’s Peacock app on its popular streaming platform. The company, which makes dongles featuring a spate of streaming apps, also takes a cut of advertising revenue from the ad-supported apps on its platform, and the agreement to host Peacock should only boost Roku's fast-growing ad business.

Copyright 2020 U.S. News & World Report

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