On Friday morning, General Electric Co. (NYSE: GE) is expected to report its first quarter earnings. Interestingly, the company has already revealed a $16 billion charge it will take as part of its plan to sell off the bulk of its capital lending unit. Based on this as well as other factors such as a stronger greenback in the first quarter and a decline in manufacturing numbers, expectations regarding the earnings report are low. According to analysts polled by Thomson Reuters, General Electric is expected to report earnings per share (EPS) of $0.30 on revenue of $34.23 billion. At the same time a year earlier, GE reported earnings per share of $0.33 on revenue of $34.18 billion. Added to this, it is known that General Electric will spend $50 billion for buybacks. In early afternoon trading on Thursday, shares of General Electric traded at $27.33, down 0.5 percent. Currently, GE stocks have a consensus price target of $29.92 as well as a 52 week trading range between $23.41 and $28.68. In 2007, the stock price of General Electric peaked above $40 a share and then in 2008, GE stocks declined to $25 before rallying to $30 before the 2008 recession.
On Thursday, U.S. stocks declined. This came after investors reacted to a mixed bag of economic data and to comments by the Federal Reserve while better than expected earnings were also reported. At the close of trading, the S&P 500 index (SPX) dropped 1.64 points, or 0.08%, to 2,104.99. Declines were led by telecom and utilities stocks with 7 out of the 10 major sectors declining. Interestingly, the SPX ended the day only 0.5 percent shy of its all-time close of 2,117.39 which it reached on the 2nd of March. Also, the Dow Jones Industrial Average (DJIA), which advanced 57 points during the trading session, closed up 6.84 points lower at 18,105.77. Meanwhile, the Nasdaq Composite index (COMP) dropped 3.23 points to close at 5,007.79. As a result of an 18 percent rally in the shares of Netflix Inc. (NFLX), the tech heavy index remained supported. Netflix shares hit a record-high of $568.75 which came after the video-streaming and DVD-rental company reported on Wednesday that they had added 4.88 million subscribers in the 1st quarter.
On Thursday, the U.S. dollar (USD) traded lower. This came in response to the release of a mixed bag of economic data which prompted uncertainty regarding the timing of a rate hike by the Federal Reserve. In their report, the Department of Labor in the U.S. said that in the week ending 11 April, the number of individuals filing for initial jobless benefits was at 294,000, up 12,000. This missed analysts’ expectation for a decline of 2,000 to 280,000 while the numbers were also up from the previous week’s total of 282,000. In a separate report, the Commerce Department reported that the number of building permits issued last month dropped to 1.039 million units, down 5.7% from February’s total of 1.102 million. Also, housing starts in the U.S. rose by 2.0 percent in the previous month to reach 926,000 units. February’s total was at 908,000 units. According to the Federal Reserve Bank of Philadelphia, its manufacturing index improved to a four-month high of 7.5 in April from a reading in March of 5.0. Analysts had expected the index to rise to 6.0 in April. The EUR/USD traded at 1.0699, up 0.18% while GBP/USD traded at 1.4888, up 0.32%. Against the yen and the Australian dollar the greenback traded mixed with USD/JPY up 0.10% at 119.26 and with AUD/USD up 1.30% at 0.7778. Also, the U.S. dollar index was at 98.34, down 0.21%.
On Friday, in Asian trading, crude oil prices declined in early trade. This came in response to a mixed outlook of oversupply and efforts to curb production. WTI crude for delivery in May traded at $56.46 a barrel, down 0.45% on the NYMEX. Overnight on Thursday, crude oil futures rose after OPEC forecasted a slowdown in U.S. production. Meanwhile on Thursday, Brent crude for delivery in June traded at $63.86 a barrel, up 0.85% on the Intercontinental Exchange.