Market players were caught by surprise by the news that the U.S. and Canada have worked out a trade deal. There are comments from pundits that the deal really isn't very meaningful but since the market was anticipating a drawn out battle it is better than the alternative.
The market didn't see the news coming and it is also benefiting from some typical strength that occurs on the first day of a new quarter when automatic investment inflows tend to occur. Breadth is running very nicely at around 4400 gainers to 2400 decliners but the small cap indices are lagging which may be due to the action being driven more by inflows than stock picking.
I've used the early strength to do some selling. I cut back my Stock of the Week, New Age Beverages (NBEV) , into strength and cut some Viking Therapeutics (VKTX) into a gap up open. I'm seeing reversals of early strength in some of my favorite names like Sarepta (SRPT) and Intelsat (I) which is being cautious about chasing momentum. The trend is up but it is tough to chase much right now.
General Electric (GE) is one of the largest on the percentage gainers list this morning after naming a new CEO. GE seldom shows up on that list but now that it has become so low priced a move of a $1 is a big percentage move. It is currently trading up about 12% and is receiving extensive coverage in the business media.
GE is a good example of a stock whose appeal will depend on the trading or investment approach that is used. Aggressive traders seldom, if ever, pay attention to GE. Not only has it been in a downtrend for years but it typically is not very volatile and seldom has sustained upside moves. It simply is not a very good or interesting trading vehicle and that is not going to change any time soon.
GE is a curiosity and attracts attention because it has been a household name for so long. It was founded by Thomas Edison and was originally named Edison General Electric. GE was long regarded as the ultimate widows and orphan stock because it was viewed as conservative safe and consistent. That certainty did not turn out to be the case but the stock is still viewed as a 'core' holding by many investment advisors simply due to its history and their familiarity with it.
Some investors with a 'value' approach my find GE of interest but there is nothing very attractive about the stock and management has a long way to go to prove itself. GE is an interesting story but there are better places for your funds.
