Why General Electric, TransEnterix, and Petrobras Slumped Today

Markets Motley Fool

The stock market lost ground on Tuesday, but the declines were once again modest as major benchmarks clawed their way back from more severe drops earlier in the session. Uncertainty in Washington once again contributed to some of the ups and downs, but a general belief in the continued strength of the U.S. economy seemed to underpin stocks broadly and keep them from losing too much ground. Still, negative news hit some companies a lot harder, and General Electric (NYSE: GE), TransEnterix (NYSEMKT: TRXC), and Petroleo Brasileiro (NYSE: PBR) were among the worst performers on the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.

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GE makes its case, but investors have doubts

Shares of General Electric fell another 6%, adding to recent losses as the conglomerate continued to face concerns about its future. CEO John Flannery followed up his investor-day presentation on Monday with a television interview Tuesday morning, but his attempts to explain GE's strategic vision going forward and the dramatic move to slash its dividend in half failed to satisfy investors who had already seen their shares lose a third of their value in 2017. Shareholders can expect General Electric to make asset sales in some non-core areas, but so far, the company hasn't perfectly explained what its core focus is going to be. Until it does, there's risk that the oldest component in the Dow Jones Industrials could suffer further declines.

TransEnterix gives back its gains

TransEnterix stock dropped 15%, essentially fully reversing course from its big jump on Monday. The robotic surgical system specialist had seen its stock climb considerably following reports that it had made its first U.S. sale of its Senhance system. Yet investors seemed to think twice today about the ramifications of the announcement, especially in light of the fact that the purchasing hospital had already formed a close relationship with TransEnterix. In the long run, the company will need to see a lot more sales in order to be successful in the robotic surgery space.

Petrobras disappoints

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Finally, shares of Petroleo Brasileiro fell 9%. The Brazilian state-controlled oil giant reported fairly weak earnings results and said that it expected to make fewer asset sales than those following the company had previously anticipated. Petrobras has a considerable amount of debt, and investors have been nervous for a long time that the state-controlled company might fall prey to the political intrigue that has been going on in Brazil for years. With operational challenges and the ever-present difficulties of adapting to changing market conditions, Petrobras will have to navigate carefully to make the most of rising energy prices when they come.

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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.