General Electric Co. (GE.N) shares bounced back on Friday after a brutal rout as Wall Street analysts defended the stock against allegations from a prominent financial examiner and reiterated their faith in the chief executive officer.

Shares rose as much as 8.2 per cent in New York, following Thursday’s 11 per cent decline, which marked the steepest drop since 2008. William Blair analyst Nicholas Heymann questioned whether the whistleblower report is “the last Molotov cocktail” and said he does not believe GE’s financial statements purposely misrepresented the company’s financial condition and potential liabilities.

The report’s effort to portray GE’s financial condition with an assumption that charges worth about $38 billion should have been previously recognized was “at best disingenuous and at worst highly inaccurate,” he wrote.

Harry Markopolos, who was involved in exposing the frauds of investment manager Bernie Madoff, said in a report on Thursday that GE would need to raise its insurance reserves immediately by US$18.5 billion in cash -- plus an additional non-cash charge of US$10.5 billion when new accounting rules take effect. He also claimed that GE was hiding a loss of more than US$9 billion on its holdings in Baker Hughes.

Markopolos said that the company’s cash situation was “far worse than disclosed in their 2018” annual report.

Citi analyst Andrew Kaplowitz said there were “sufficient shortcomings” in the report itself, and that he continued to believe in CEO Larry Culp’s ability to improve the company. Some of the allegations made in the report were already known and others were “known unknowns,” the analyst said, adding that the Baker Hughes write-off was already expected.

Baker Hughes shares also rose as much as 2.1 per cent on Friday in New York