Posted on 04/11/2008 3:05:35 PM PDT by TigerLikesRooster
U.S. stocks hard hit by GE's disappointing results
Nasdaq fronts weekly decline, off 3.4%; Dow, S&P slump more than 2%
By Kate Gibson, MarketWatch
Last update: 4:37 p.m. EDT April 11, 2008Print E-mail RSS Disable Live Quotes
NEW YORK (MarketWatch) -- U.S. stocks on Friday sunk to April lows and weekly losses, with the market undone by General Electric Co.'s earnings miss, jolting investors and casting a bleak light on a slew of earnings reports next week.
"GE never surprises us, and they had the whole month of March to let us know. All they had to say is, for the love of God, business is actually slow!" said Art Hogan, chief market strategist at Jefferies & Co.
The Dow Jones Industrial Average ($INDU) shed 256.56 points, or 2%, to end at 12,325.42, pulling the blue chips down 2.2% on the week.
Of the Dow's 30 components, all but one ended in the red. The decline was fronted by General Electric (GE) , with its shares suffering their worst one-day percentage drop since October 1987, losing 12.8% to end at $32.05.
The industry bellwether reported a 6% decline in first-quarter net profit, largely over trouble in its financial-services businesses. Read full story.
(Excerpt) Read more at marketwatch.com ...
Hmmm, I’m not sure how #15 relates to your #13, but I’m not especially alert right now (the market’s closed!), so it’s probably my fault...
Don’t ya just love it. When things go wrong all you hear is we didn’t do this, we didn’t do that, we ,we, we. When its time for bonuses worth 10’s of millions of dollars, it I did this, I did that, I, I. I don’t mean to single our GE, this is pretty much the attitude of the corporate types.
Corporate execs aping politicians.:-) When this happens a lot, we are in a real trouble.
Sales were up 8%.
So what was the big impact on margins? I’d like to see more details. Were there writedowns?
I’d also like to see who bought at $32. Another fleecing, I’m sure.
Expect Immelt to order NBC News to step up the Global Warming scam so they can sell more lightbulbs and power systems. Control the press and you can control your destiny. They’ll use this excuse to fire more people and offshore more work.
That caught my eye too. FWIW, the dollar declined in value in the last quarter by 8% also.
Exactly. The big issue here is that GE has been a very reliable company, very steady-eddie on earnings announcements, very forthcoming when there have been problems.
There were two problems here today:
First, GE surprise people with this clanger of a miss. GE hasn’t done this — ie, surprised people with this kind of miss — without giving analysts and investors a heads-up during the quarter.
Second big problem was GE saying that the ‘landscape’ had changed after the Bear Stearns problems. So, what are they saying? That they own highly speculative paper too? What bearing would Bear’s collapse have on GE’s assets? That’s what has me wondering what is on GE’s books.
Who bought at $32?
Probably some funds, but I’ll bet when things got good and crazy, the specialists stepped in and bought up a bunch, knowing that after the numbers are more closely analyzed this weekend, some funds might be stepping up to buy more shares on Monday. Even if there’s only a dime’s worth of spread between the specialists’ buy point and where they sell it next week, they’re going to make a snootful of money.
I am not a financial person, far from it, but it seems to me some of those who are tend to spend a bit too much time looking at the markets. It’s like a doctor checking a sick person’s pulse every 1/2 second and declaring the patient dead 60 times a minute!
Me too. I look at my accounts once a year and that is it. Why do people get themselves in such a tizzy over this stuff. The stock market has been up and down every day for years. This does not bother me a bit. I know some are getting ready for retirement, but if that is the case, they should have at least considered taking the money out of the stock market a few years ago.
Not only didn’t warn but were upbeat and cheerful in March.
I use your products. You guys do a great job.
Thanks, we’re number two so we try harder!
Me (just a little). But I'll gladly sell to you Tuesday if it bounces up from today.
Sweet. That’s well over a year’s worth on today’s CD rates.
A further worry. Many retirement funds, including pension funds are very heavily invested in GE. With a 13% loss today as well as a large loss in the Dow, S&P and the Nasdaq, what kind of rightdown will be necessary for these large retirement and pension funds??
The stock is CPST. Check it out!
"Mr Immelt presented an upbeat outlook less than a month ago, saying on a webcast that GE would increase earnings at least 10 per cent this year. GE said on Friday its profits would grow no more than 5 per cent in 2008."
This goes on all the time. Look at Merrill. The reason this happens is because there is no penalty, no fine, no embarrassment. Whoops, Sorry. Let them eat cake!
A close look at what happened in the past month would reveal some interesting facts.
This is a huge indicator of what is to come. If you are heavy with equities you should be more than just concerned.
"Immelt blamed the earnings decline on a seize-up in capital markets that forced GE to write down the value of loans and Chinese securities."
Anyone who thinks we are close to being "out of the woods" is just fooling themselves.
You could see it coming last November, and you didn’t even need to be Einstein. All you had to do is be alert and be reading what was happening to the markets and in subprime. It was pretty obvious the consumer was going to pull back, even all the while the idiots in the financial media were saying, “It is amazing the consumers are not pulling back. I think they are here to stay!”
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.