Two Ways To Play: GE Sells Its Soul
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According to the Wall Street Journal, General Electric (GE) is considering shedding its appliance unit, a business the company first entered into in 1907. Milestones such as the refrigerator, air-conditioning units, and toaster ovens helped make GE a household name. Now, the company has hired Goldman Sachs (GS) to run an auction because the appliance business may not expand enough to help the company reach its targets. The sale may fetch between $5 to $8 billion. For a branding primer, see Professor Depew's Five Things You Need To Know: The top 10 Most Powerful Global Brands.
From the Bull Pen: Those bullish on GE can set sell-stops below $31.55. Other plays in the sector could include Honeywell (HON); sell-stops below $58.
From the Bear Cave: Is GE cutting off a solid business? Isn't the financing unit the problem? Those bearish this "bearded financial" can fade the stock into $35 should it approach that level.
Macy's Surprises Wall Street
According to the Wall Street Journal, Macy's (M) reported a fiscal first quarter loss due to restructuring costs and more clearance sales. But shares of the second-biggest retailer rose after sales fell less than analysts estimated. First quarter sales fell 2.9% and same-store sales declined 2.6%. But the company also kept its full-year profit forecast, expecting to earn $1.85 to $2.15 a share. Macy's closed yesterday's session +3.6% to $24.93. See Professor Jeff Macke's Sony, Macy's Rewarded For Mediocrity.
From the Bull Pen: In retail, the best-in-breed is Wal-Mart (WMT); bulls might fade into the stock should it approach $55. Target (TGT) is also another option; sell-stops can be set near $52.
From the Bear Cave: Was yesterday's jump a short squeeze? Macy's stock has lost nearly 45% from its June 2007 high. Bears might choose to fade this stock into its 200 DMA ($27.81).
For more ideas in real time throughout the trading day, check out Minyanville's Buzz & Banter.
Quick Check Around the World
Asian trading closed with the Hang Seng -0.08%, Nikkei +0.94%, Sensex +2.21%, Taiwan +1.54% and Shanghai -0.55%.
A quick check across the pond finds the CAC -0.08%, DAX -0.18%, FTSE +0.35%
As of 8:40 AM EST, S&P futures are higher +3 points to 1410, and Nasdaq futures are up +6 points to 2002.
A Look At Commodities
Commodities are higher. Crude oil is up +0.70 to 124.92. Gold is up +6.40 to 872.80. Silver is lower -0.30 to 16.520, and copper is higher +3.40 to 374.10.
The dollar index is lower -0.072 to 73.327.
On the Radar
Initial Jobless Claims: 371 k vs. 370 k cons.
Continuing Claims: 3035 k vs. 3035 k cons.
Empire Mfg: -3.2 vs. 0.0 cons.
9:00 Net Long-term TIC Flows: $72.5 billion prior.
9:00 Total Net TIC Flows: $64.1 billion cons.
9:15 Industrial Production: -0.3% cons.
9:15 Capacity Utilization: 80.1% cons.
10:00 Philadelphia Fed: -20.0 cons.
1:00 NAHB Housing Market Index: 20 cons
Click here for the full trading radar.
Good luck, Minyans!
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