Today is the day when General Motors is scheduled to be priced for their initial public offering(NYSEARCA:IPO). According to reports in the media the stock will be priced at $33.00 a share and it is wanted by the public or what we call over subscribed. It is important to remember that the U.S. taxpayer already owns Government Motors to some extent.
Many hedge fund and money managers including Micheal Steinhardt who is the founder of Wisdom Tree Funds stated that he would sell it as quickly as he can. This is exactly what many others in the business are saying. Often when an IPO opens for trading it is usually beneficial when the overall stock market is very strong. Since last week the major stock market indexes have sold off sharply. Yesterday was the first day in months that new 52 week lows out paced new 52 week highs. Yesterday their were just 23 new 52 week highs and 123 new 52 week lows. I'm sure this in not exactly what the government and the General Motors underwriters had in mind when they debut the stock for open trading.
Yesterday many leading stocks in all sectors sold off sharply in a broad based decline. Leading stocks such as Exxon Mobil Corp.(NYSE:XOM), Baidu Inc.(NASDAQ:BIDU), and Freeport McMoRan Copper & Gold Inc.(NYSE:FCX) all sold off sharply. When the leading stocks decline traders and investors must beware of the current economic conditions. Today housing starts hit an 18 month low in October and this just adds pressure for the release of such a highly anticipated IPO.