Why GE and Airline Stocks Are Down Friday
General Electric (NYSE: GE) made news recently when it announced its intent to split itself into three companies focused on aviation, healthcare, and energy, respectively. Investors cheered that plan, as well as the conglomerate's efforts to improve its balance sheet. But GE stock hit a speed bump Friday after news broke Thursday that a new and potentially concerning variant of COVID-19 has been found.
Fears about what this latest evolution of the coronavirus could mean sent GE stock down by 6.2% as of 11:04 a.m. ET. At the same time, airline stocks including United Airlines Holdings (NASDAQ: UAL) and Spirit Airlines (NYSE: SAVE) were down 12.6% and 11.8%, respectively.
GE's aviation business is its largest segment, and investors are worried that the rebound in travel could be impacted by the spread of a new COVID-19 variant that is resistant to the currently available vaccines. In the first nine months of 2021, GE's aviation segment revenue exceeded $15 billion. In just the third quarter, orders grew 70% year over year to almost $7 billion as its commercial engines and commercial services sales returned to substantial growth. Now, though, the rebound of the commercial airline sector is again in question.
Source Fool.com
