Wall Street ticks up as dividend payers rise, GE slashes payout
US stock indices rose on Monday as a sharp drop in General Electric (GE) shares was more than offset by gains in high dividend-paying sectors including consumer staples and utilities.
NEW YORK — US stock indices rose on Monday as a sharp drop in General Electric (GE) shares was more than offset by gains in high dividend-paying sectors including consumer staples and utilities.
GE slashed its dividend by 50% and cut its profit forecast while unveiling a plan that narrowed its focus on aviation, power and health care.
Shares of the industrial conglomerate fell 7.20% to $ 19.02 after touching a more than fiveyear low of $18.75.
“People who were in GE for their dividend may be looking for a better place to put their money,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
Utilities and consumer staples rank among the sectors with the highest dividend yield on the S&P 500. They were also the largest percentage winning sectors on Monday.
The Dow Jones Industrial Average rose 17.49 points, or 0.07%, to 23,439.70, the S&P 500 gained 2.54 points, or 0.10%, to 2,584.84 and the Nasdaq Composite added 6.66 points, or 0.10%, to 6,757.60.
Investors are closely tracking developments around the tax bill after US Senate Republicans last week unveiled a new plan that differed from the House of Representatives’ version.
Some relief for investors did come from the regulatory side, and shares of regional banks rose after the Wall Street Journal reported a bipartisan group of Senate lawmakers reached a tentative agreement to ease some regulations on the sector. The KBW Regional Banking Index gapped lower at the open but turned positive mid- session and ended up 1.30% after steadily climbing in afternoon trading.
Toymaker Mattel jumped 20.70% to $ 17.64 after a report that rival Hasbro made an approach to acquire the company. Hasbro rose 5.90% to $96.84.
Qualcomm gained 3% to $ 66.49 after the chipmaker rejected rival Broadcom’s $103-billion takeover bid, saying the offer “dramatically” undervalued the company.
Tyson Foods shares climbed 2% to $75.59 after the meat processor said low prices for livestock feed will help boost results again next year. Shares touched their highest since September 2016.
Declining issues outnumbered advancing ones on the NYSE by 1.27 to one; on Nasdaq, a 1.02-to-1 ratio favored decliners.
About 6.18 billion shares changed hands in US exchanges, fewer than the 6.67 billion daily average over the last 20 sessions. —