EIB Test April 2008 | Page 124

Yoojung Park(Stella) UCR Extension 1200 University Ave. Riverside, CA 92507 Email: [email protected] Phone : (1-951) 756-3404 2> However, after July 21, the share price of GE has been decreased. On July 22, the stocks on NYSE were on a downtrend. According to Market Watch, the secondquarter performance of Caterpillar, heavy-equipment maker, was disappointing and it sparkled the declines of the stock market. Because Caterpillar has the second biggest proportion among the Dow, the impact was too strong. After the earnings announcement of Caterpillar, index futures moved downward and stock index was affected. This dragged the share price of corporations that have good results down such as GE and Verizon. 3> There is another reason. According to Seeking Alpha, GE made a critical mistake. GE was moving the headquarters of its historical X-ray business to Beijing. GE said a few top managers would move to the Chinese capital and there would not be any job cuts. They see potential growth and cheaper manufacturing over there, but the fact is that there are some risks that the qualities can be lowered and the Chinese stole its technology. This situation made investors feel uneasy and be out of the stock. I want to keep it. This is my reason why I want to remain it although I lost money. First, GE has a lower and somewhat stable share price than other stocks such as Amazon and