Stocks Down, But Apple Thrives; Will GE Exit The Dow Industrials?

Stocks slumped in late-afternoon trading Monday but the declines among the major indexes remain mild. Apple (AAPL) bucked the drop with a 2% lift to 166.57 and new all-time highs.

Apple has now gained 41% after a Jan. 6-9 breakout from a first-stage cup with handle at 118.12.

The iPhone giant, which reportedly is seeing brisk orders for its most expensive iPhone ever (the X), is also following through on Friday’s breakout from a brand-new cup with handle that shows a 160.97 proper entry.

General Electric (GE), meanwhile, led the Dow Jones industrial average to a 0.3% decline as the firm that goges back to the days of Thomas Edison lopped off another 44 cents, or 2%, to 20.35.

At 3 p.m. ET, GE’s volume is running more than 50% heavier than usual. GE slid nearly 13% in monster weekly volume last week.

The Dow Jones industrial average is a price-weighted index of 30 names, and the keepers of the average replace lagging companies with higher priced better performers. Recent new entrants include not just Apple but also Goldman Sachs (GS) and UnitedHealth Group (UNH). All three trade more than 100 a share.

Cisco Systems (CSCO) and Pfizer (PFE) have the next lower share prices within the Dow 30, trading near 34 and 35.08, respectively.

Cisco, giant in computer networking and internet-based telecom gear, is challenging institutional buying support near a 34.20 buy point in a new cup with handle. The stock fell more than 1% to 34 in dull turnover.

GE had recently peaked at 33 in the summer of 2016 and now stands nearly 39% below that high. Its Relative Price Strength Rating is a horrifying 7 on a scale of 1 to 99. Certainly, pressure is mounting on GE’s new management team, led by John Flannery, to reinvigorate growth. Flannery has served many top posts at GE, including head of GE Capital and the India operations.

The company’s adjusted third-quarter earnings fell 4% to 26 cents a share, sharply missing Wall Street’s view, according to data from William O’Neil + Co.

The S&P 500 also slipped 0.3% despite strength across the oil patch. WTI near-term futures edged 0.4% higher to $ 54.13 a barrel on the Nymex. The Nasdaq composite was down slightly.

Back to Apple, earnings had dropped 10% in the fiscal year ended in September 2016 on an 8% slump in revenue. However, Apple has been staging a classic turnaround in fundamentals lately.

In the past three quarters, the iMac maker’s earnings rose 2%, 11% and 18% vs. year-ago levels, following a three-quarter slump. And in Q4 (ended in September), earnings are seen increasing 12% to $ 1.87 a share, which would mark a third quarter in a row of mild double-digit gains. It’s slated to report Q4 results on Nov. 2 after the market close.

For fiscal year 2019, the Street sees earnings accelerating 24% to $ 11.16 a share.


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