Even after the Lion Air crash of its state-of-the-art MAX 8 in October, Boeing was predicting another banner year in 2019. Orders of its aircraft were up. It had notched three major Pentagon contracts. And its stock was flying sky high.
But now, after another of the aviation giant’s workhorse jets crashed, this time in Ethiopia, killing all 157 people on board, it’s facing renewed questions about its safety and reliability as investors knocked back its share price more than 12 percent in early trading Monday. It recovered somewhat as morning trading went on.
Boeing, which last year had carried the Dow Jones industrial average to record highs, dragged it down on Monday morning, as the blue-chip measure opened in the red.
China, Indonesia and Ethiopia have grounded the 737 MAX 8 aircraft, which was involved in both crashes, and other carriers have signaled they may follow suit.
The Chicago-based U.S. aerospace giant, with more than $100 billion in revenue and 153,000 employees, is one of the most heavily weighted of the Dow’s 30 components. It has been one of the drivers of the 10-year-old bull market; its stock had been up more than 30 percent, year to date, as of Friday’s close.
The “decline is weighing heavily on the Dow because the stock has much more to surrender than other Dow components,” said Sam Stovall of CFRA Research.
The Standard & Poor’s 500-stock index and the Nasdaq composite index showed slight gains in early trading Monday. Europe and Asia markets were also up, despite growing concerns over global growth spurred by a disappointing U.S. jobs report on Friday.
The crash comes as the aerospace giant has been having a stellar year.While its