Stocks rally on GE deal as Dow jumps about 100 points
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Wall Street cheers blue chip General Electric’s (GE) huge announcement before the bell. GE is selling most of its GE Capital unit to become a pure play industrial company. Newslook
Stocks rose for a third straight day Friday as the Dow rallied nearly 100 points and jumped back above the 18,000 level to close out with a weekly gain.
Markets got a boost from GE (GE) as its shares surged more than 11% on a deal to sell the bulk of its GE Capital banking business that could give shareholders a potential $ 90 billion return.
The company also announced a $ 50 billion buyback. GE shares rose $ 2.78 to $ 28.51.
GE was the leading stock in the Dow Jones industrial average as the blue-chip index jumped 98.92 points, or 0.6% to 18,057.65. The Standard & Poor’s 500 index rose 10.88 points, or 0.5%, to 2102.06 and the Nasdaq composite index gained 21.41 points, or 0.4%, 4995.98.
For the week, both the Dow and the S&P 500 gained 1.7%. The Nasdaq jumped 2.2%.
Oil prices capped off a volatile week with a gain of 85 cents to close at $ 51.64 a barrel in New York. Benchmark crude posted a 5% gain for the week.
In other corporate news:
• Pre-orders for the Apple Watch kicked off Friday as wait times for shipments ranging from several weeks to as late as August. Apple (AAPL) shares gained 0.4%.
• Shares of Excel Trust (EXL) soared 14% after Blackstone Group agreed to buy the real estate investment trust in a $ 2 billion deal.
Blackstone went on a real estate buying spree Friday as it also teamed with Well Fargo (WFC) to buy GE’s real estate assets valued at $ 23 billion. Shares of Wells Fargo rose 0.2%.
Earnings season kicked off this week and investors have been concerned about a slowdown in corporate profits. Next week markets will get a look at the financial health of the banking industry as Bank of America (BAC), Goldman Sachs (GS), JPMorgan Chase (JPM) and Wells Fargo and set to report.
Overseas, Japan’s benchmark index topped 20,000 for the first time since April 2000 early in the trading session before retreating and closing down 0.2% to 19,907.63. The index hit its highest level in 15 years on expectations for Japan’s economic recovery and brisk corporate earnings, following the aggressive monetary stimulus program.
European shares rose as Germany’s DAX index added 1.75% and France’s CAC 40 gained 0.6%.
U.S. stocks edged higher on Thursday, led by gains for energy companies as the price of oil stabilized following a big drop the day before.
Contributing: Associated Press
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