Small caps fall due to GE
The Russell 2000 (NYSE:IWM) opened with a steep decline on news of a profit decline at General Electric Co. (NYSE:GE).
At 10:04 a.m. ET, the small-cap index was down 10.56 points, or 1.49%, to 696.86. The Dow Jones Industrial Average had dropped 152.75 points, or 1.21%, to 12,429.23.
The bears are in control this morning on news before the opening that General Electric suffered a decline in first-quarter profit and lowered its full-year 2008 earnings guidance.
“Demand for our global infrastructure business remained strong, but our financial services businesses were challenged by a slowing U.S. economy and difficult capital markets,” chairman and CEO Jeff Immelt said in a statement.
Observers see the results as a confirmation of a U.S. economic slowdown.
General Electric, which is famous as a technology company, also has a media arm. Some of the small-cap companies in that space are currently trading in the red.
Shares of Lee Enterprises Inc. (NYSE:LEE), which has daily and weekly newspapers, are off about 1%. Same for Media General, Inc. (NYSE:MEG), which has interests in newspapers and television station.
Elsewhere, Fairport, N.Y.-based GateHouse Media, Inc. (NYSE:GHS), which publishes print and online media, is flat.
