Midday Update: GE Stinks Up The Joint; Banks Trade Dry

Boy, GE really took the wind out of the market's sail. The bellwhether conglomerate missed earnings estimates and lowere its full year outlook. Most of the shortfall seems to have come from the finance unit and related difficulties. But the stock is getting whacked for -11%, its biggest one-day drop since October 1987.

And given that GE is one of the biggest market caps in the market, it is really weighing on the overall market. The silver lining of this mornings action is that the financials trade dry, meaning that they are bucking the weakness. (see C, WFC, LEH, MER)

Fronteir Airlines (FRNT) is filing for bankruptcy after posting massive losses. Things definitely do not look good in the airline sector.

Asian markets were up overnight, led by a +2.9% spike in Japan. The Yen is also higher today, which is always a headwind for the markets.

Oil is slightly lower, breaking below $110; the 10-year yield is down again, to 3.46%; and the put/call ratio is again high at 1.32.

The S&P 500 is testing support at its 50-day average near 1342. If it holds, it should be a good place to add long exposure and expect a bounce. But with earnings season starting off with a dud, I think investors need to stay nimble.