Shares of General Electric (GE) were up Tuesday despite a decline in the broader market, possibly on hopes negative catalysts to the stock's value are already priced in.
GE's gains came despite a drop in large banks such as Citigroup (C), JPMorgan (JPM), Wells Fargo (WFC) and Bank of America (BAC). GE has frequently traded in tandem with those institutions, due to the large contribution of its financial services unit to the firm's overall balance sheet
Moody's Investors Service downgraded GE yesterday, following on the heels of Standard & Poor's. Those two big ratings agencies had long been expected to cut GE's sacred AAA rating, and fears of how the market would react may have been pressuring the stock. Moody's now has a stable outlook on GE's rating.
Another concern had been that GE would trim its dividend, which it had not done since the Great Depression. That came to pass last month, when GE cut the dividend 68% to 10 cents per share.Now the worst of the bad news may be past, giving the shares some breathing room.
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