US stocks inched higher in another choppy trading session boosted by General Electric’s plans to divest the bulk of its high risk lending operations.
Investors lauded GE’s decision to sell the bulk of its $30 billion real estate operations in the next two years as it seeks to return to its industrial core operations. The decision bolstered the Dow Jones Industrial and the S&OP industrial.
“The GE deal is very transformative. The stock has been under-owned by institutional investors and that’s going to change now,” Tom Donino, co-head of equity trading at First New York Securities, told Reuters.
Most of its assets will be snapped up by Blackwell and Fargo with the decision coming just after General Electric said that there was a possibility that it could return more than $90 billion to its shareholders.
General Electric shares surged more than 8% on Friday pacing the Dow Jones Industrial average 67 points higher or 0.4% to 18,025. The company’s stock added more than 14 points to the Dow with more than 27 million of its stock exchanging hands.
The S&P industrial gained 1.5% on the announcement to become the best performing of the S&P 500 Index’s 10 key sectors.
The Benchmark S&P gained traded up 8.8 points or 0.4% to 2100 while the technology heavy Nasdaq Composite inched up 12 points or 0.2% to 4986 points.
The Market has recently remained relatively with the Dow and the S&P yet to make 1% moves this month.
“The past couple of weeks, it’s like we’re in a washing machine. There’s a lot of agitation but we’re not going anywhere,” Anwiti Bahuguna, senior portfolio manager at Columbia Threadneedle Investments, which manages $506 Billion, told the Wall Street Journal.
Traders, however, expect the earnings season-where companies report their first quarter corporate earnings- to act as catalysts for market movements and to guide investors before making any major shifts in their equity portfolios.
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