What's going on?

General Electric (GE), the industrial conglomerate, reported results on Friday � and, after a very good run of things, it appears that the engine is losing steam (at least for now).

What does this mean?

About 15 months ago, GE embarked on a huge strategy shift. It re-focused on its traditional business of industrial goods (like making locomotives) and sold off many of its other businesses (like its finance arm and its home appliances division). It�s a strategy that investors have loved � its stock is up more than 20% in the past year. GE�s results on Friday were actually better than investors were expecting despite weakness in areas like oil and gas equipment. Strength in jet engines, power equipment and medical technology made up for things. But the stock still sold off about 1.5%.

Why should I care?

For the stock: Investors are left asking, what�s next?
At the current stock price, investors appear to be already factoring in GE�s transformation back to its roots as an industrial company. With the big news now out of the way, the immediate future will depend, pretty simply, on how much equipment GE can sell. And that�s going to be challenging in a world where global economic growth remains sluggish.


The bigger picture: GE�s results show the wider impact of the slowdown in the US oil industry.
The oil price has more than halved since 2014 and that�s put a serious damper on the oil industry in the US (lots of production has been halted as it�s not profitable to pump oil in many places at the current price). The impact on oil-producing states like Texas and Oklahoma is fairly obvious, but there are lots of other companies and people that benefit from a booming oil business � which is one reason why the oil price matters so much.