General Electric Company (GE), The Boeing Company (BA): Markets Rally on Improving Auto Sales and Rising Factory Orders

Page 1 of 2

Strong economic data reports were released today, and for the most part investors seem to like what they see. As of 12:45 p.m. EDT, the Dow Jones Industrial Average was up 33 points, or 0.22%. The S&P 500 and the NASDAQ were also higher, up 0.34% and 0.22%, respectively, but all the major indexes have pulled slightly back from their highs of the day, which were hit just before 12 p.m. EDT.

U.S. auto sales experienced a nice bump higher in May, as Ford Motor Company (NYSE:F) reported light-vehicle sales rose by 13% in the month, which helped the automaker experience its best June in nearly seven years. All the while, General Motors Company (NYSE:GM) managed to post solid numbers as it realized vehicle sales increase of 6.5% in the month, which was the company’s best performance in nearly five years.

In addition to the positive auto reports, U.S. factory orders rose in May by 2.1%, which was an increase from April’s revised 1.3% rise. We are now seeing evidence that manufacturing is coming back as we have now experienced three straight months of improving data.

General Electric Company (NYSE:GE)

One would think with the strong factory report that The Boeing Company (NYSE:BA) and General Electric Company (NYSE:GE) would both be jumping higher, not topping the Dow’s losers list, but they are indeed. Shares of Boeing are down 1.08%, and General Electric is lower by 0.90% this afternoon. The report indicated that demand for aircraft rose 51% in May, which came after an 18.4% rise in April and a drop of 43.3% in March. The only reasonable explanation for The Boeing Company (NYSE:BA) moving lower today is that investors were expecting a higher increase in May. But, even if May didn’t wow investors, we would expect next month’s report to come in big again, as the Paris Air Show was in June and preliminary reports indicated that The Boeing Company (NYSE:BA) inked a number of big deals during the exhibit.

As for General Electric Company (NYSE:GE), durable goods orders and power generation equipment also both increased in May — two areas of industry that GE operates in — but the stock is also lower today. One reason that may be isn’t because of the factory orders report, but rather the announcement that the company closed the deal to buy Lufkin Industries, Inc. (NASDAQ:LUFK) for $3.3 billion. The acquisition gives General Electric Company (NYSE:GE) more diverse offerings in the oil and gas industry, but as the natural gas boom continues to rage on here in the U.S., the question must be asked, “What will happen when things begin to slow down?” As GE builds out its offerings for this industry, how long will it take the company to recoup this investment — and will it be worth it in the long run? We have seen General Electric Company (NYSE:GE) grow too big before; perhaps the company is once again making the same mistake.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Best States To Practice Medicine

The 10 Best States to Have a Business

The 12 Most Expensive Apple (AAPL) Apps in the Market

The 10 Richest Billionaires in the World

10 Biggest Kickstarter Failures

The 10 Best Places to Work At

The Top 10 of Google Inc (GOOGL)’s Most Expensive Acquisitions

13 Best Cities to Visit in South America

10 Most Expensive Works of Art of All Time

The 10 Richest Banks in the World

The 10 Best-Paying Jobs in America (2014)

7 Most Expensive Foods in the World

The World’s Top 10 Earning Authors

Five Wicked and Very Expensive Items (and Other “Stuff”) Sold on eBay

10 Biggest Celebrity Bankruptcies

The Top 10 Highest Paid CEOs in 2014

The 10 Most Expensive Real Estate Cities in America

10 Most Expensive States To Live In America

The 10 Best Airlines in the World

The 10 Best-Selling Cars in 2014

The 10 Best Industries to Invest In

The 10 Most Expensive States to Own a Car In

Top 10 Business Schools in US: 2014 Rankings

Top 20 Female Billionaires in 2014

6 Movies That You Should Watch to Better Understand The Cold War

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!