IBM and CIT group on Dow focus
IBM and CIT Group bolster the markets that gained strength on a number of positive reports. One is a winner and the other is half-dead. However, both pushed the markets up.
IBM is doing well with strong fundamental numbers. So is Cisco, and Intel. Tech stocks are a surprise as it seems they are more resilient than expected in dour times. CAT also came in strong, which may also seem odd to some. Maybe they benefit from US housing starts which were stronger than expected.
Then we have CIT Group, currently on life-support. CIT has leveled off in “critical condition” after a financial shot-in-the-arm from bondholders. Will this stave off bankruptcy? The market seems to think so, at least for the moment and City helped push the Dow during opening of week with a near-doubling on the European markets. Considering the global impact CIT has I am not surprised by the financing help they are getting. If one goes down they all do.
On the other hand, White House director of the National Economic Council, Lawrence Summers, indicated the growth for next year of the US economy is “very much in doubt” and will depend on flow of credit, confidence levels, and global incidents. CIT bankruptcy would be one of those “global incidents”.
General Electric. What to say? It just goes on…
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