"There are also lingering memories of (Honeywell's) high-profile United Technologies pursuit that was eventually abandoned in early-2016, which would have meaningfully increased the aerospace exposure of the combined company," Dray noted.
GE, which has said it would tie bonuses to profit and cost-cutting targets amid pressure from Trian Fund Management, slipped 0.4%.
Third Point, in its first-quarter investor letter on Thursday, said Honeywell's aerospace business "is the chief cause of Honeywell's discounted valuation" and was better off on its own.
The fund argued that the aerospace segment had not kept up with rivals and was the primary reason behind weaker earnings at Honeywell.
Third Point, which CNBC reported substantially added to its Honeywell stake, said that separating the aerospace segment would help turn Honeywell into "an industrial growth company with a focus on automation and productivity." Honeywell, in a statement Thursday, said "we intend to take the time necessary to ensure a comprehensive, informed and objective review of the potential separation of the Aerospace business." The company said that it will "continue executing its 2017 plan." Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities.