Stocks slip from record or near-record highs to start week
The major averages are modestly lower to kick off the new week after closing at or near record highs on Friday. There is a heavy earnings slate this week as reporting season picks up momentum, with Coke headlining this morning's reports.
ECONOMIC EVENTS: In the U.S., no economic data of note was reported.
TOP NEWS: Peloton (PTON) shares were 9% lower near noon after the U.S. Consumer Product Safety Commission issued a bulletin over the weekend about the "danger" of the Peloton Tread+ exercise machine after multiple incidents of small children and a pet being injured beneath the machines. "The Commission has found that the public health and safety requires this notice to warn the public quickly of the hazard," the CPSC added. In response, the company refuted such claims, saying it is "troubled" by the "inaccurate and misleading" press release on the matter. Following the news, Truist analyst Youssef Squali maintained a Buy rating on Peloton, saying the CPSC warning is unlikely to have a material impact on Peloton's profit and loss statement.
Shares of Tesla (TSLA) have slipped 4% after The Wall Street Journal reported that two men died after a vehicle that authorities believe was operating without anyone in the driver's seat crashed into a tree Saturday night north of Houston.
On the earnings front, shares of Coca-Cola (KO) were about 1% higher at midday after the beverage giant reported better than expected Q1 results. The company also announced that it plans to list Coca-Cola Beverages Africa as a public company. Looking ahead, Coca-Cola provided fiscal 2021 earnings growth guidance and said it expects Q2 adjusted earnings to include a 5%-6% currency tailwind.
In other earnings news, Harley-Davidson (HOG) shares jumped 12% after the company reported upbeat quarterly results, with Q1 adjusted earnings per share nearly doubling the consensus estimate.
Meanwhile, GameStop (GME) shares gained 8% after the video game retailer announced that George Sherman will be stepping down as CEO on July 31, 2021. The news follows a report from Reuters earlier this month saying that the company was looking for a new chief executive as it transitions from being a brick-and-mortar focused company to an e-commerce one.
MAJOR MOVERS: Among the noteworthy gainers was Knoll (KNL), which rose 33% after Herman Miller (MLHR) announced it will acquire Knoll in a cash and stock transaction valued at $1.8B. Herman Miller shares fell 12% after the news. Also higher was Clean Energy (CLNE), which gained 9% after the company announced it has signed an agreement with Amazon (AMZN) to provide renewable natural gas.
Among the notable losers was Haemonetics (HAE), which declined 34% after the company announced that CSL Plasma will not renew its supply agreement with Haemonetics for the use of PCS2 plasma collection system devices and purchase of disposable plasmapheresis kits in the U.S. Also lower was Lordstown Motors (RIDE), which fell 11% after WKBN reported that the company's Endurance electric pickup truck was unable to cross the finish line in the SCORE International San Felipe 250 desert race Saturday.
INDEXES: Near midday, the Dow was down 147.63, or 0.43%, to 34,053.04, the Nasdaq was down 161.46, or 1.15%, to 13,890.88, and the S&P 500 was down 24.91, or 0.60%, to 4,160.56.