General Electric underlined the depth of the global financial crisis on Friday, announcing its worst quarter in five years and slashing full-year forecasts.
The news, described as “shocking” by a senior GE executive, combined with data showing that US consumer confidence was at a 26-year low to send shares lower. The S&P 500 fell 2 per cent in New York to 1,332.83.
Shares in GE, which derives more than half its revenues overseas and is seen as a bellwether of the global economy, led the way, falling 12.8 per cent ”“ its biggest loss since the 1987 stock market crash.
The results are a blow to Jeffrey Immelt, chairman and chief executive, and could increase pressure for action at the group’s underperforming financial and healthcare divisions.
Immelt has had a rough road since Jack Welch’s retirement. It may be time for a more aggressive leader.
Unbeknownst to many people, General Electric is almost as much a financial institution as a manufacturer.