ABB Ltd. (ABB) shares fall following downgrade at Jefferies Group

ABB Ltd. (NYSE: ABB) shares fell on Tuesday Dec 13 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.

Meanwhile, the Dow DJIA, +0.47% climbed 106 points, or 0.6%, to 19,905. If the Dow finishes higher, it will notch its seventh straight gain.

The S&P 500 index SPX, +0.56% gained 10.45 points, or 0.5%, to 2,267 and the tech-heavy Nasdaq Composite Index COMP, +1.02% added 48 points, or 0.9%, to 5,461.

Both the S&P 500 index SPX, +0.56% and Nasdaq Composite COMP, +1.02% ended lower on Monday, with investors appearing reluctant to push shares higher ahead of the Fed meeting

Shares of ABB Ltd. (NYSE: ABB) were downgraded by analysts at Jefferies Group in a note to their investors today. With a rating of Underperform on the shares, ABB Ltd. has a 52-week high of $22.92. The one-year price target of $21.39 is above the opening price of $21.20, causing a number of other analysts to report on the company in recent days. Downgrades occur when analysts consider that the future prospects for the security have weakened from the initial recommendation, usually because of a considerable and crucial digression in the company’s actions, future outlook or industry.

Shares of ABB Ltd. (NYSE: ABB) opened at $21.20 on Tuesday trading between $21.17 and $21.25, and last traded at $21.18, which represents a decrease of $0.09 per share or -0.40% over the previous closing price.

ABB Ltd. (NYSE: ABB) now has a market cap of 45.23B.

ABB Ltd. (NYSE: ABB) Average Daily Trading Volume

The stock’s average daily volume is 1,884,370 shares out of a total float 1,769,101,000 and some 476,948 shares traded hands yesterday, below normal. Investors often use upticks in trading volume to pinpoint heavy volume aggregation or dissemination by institutional investors, so look for trading volume to pick up in the coming days.

While an increase in trading for short periods will not mean much, however, a trend of heavy trading volume on the buy side over a period of days or weeks delivers a positive cue to market traders that institutions may be moving in, so institutional sponsorship is very important.

Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.

These instituitional investors retain teams of analysts researching thousands of stocks. So watching their interests is a good way to ensure you are buying the right stocks.

ABB Ltd. (NYSE: ABB) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By identifying trends, moving averages allow traders to make those trends work in their favor and increase the number of winning trades.

Trades for ABB Ltd. (NYSE: ABB) have ranged from $15.74 – 22.920, and the stock now has a 50-day MA of $20.92 and 200-day MA of $21.28. Today’s last price is 7.61%% under the 52 week high of $22.92.

Earnings growth is a crucial factor to look at when investing in stocks and investors seek companies that have increased their earnings by at least 25% over a 3 year period.

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