- Boeing shares trade down more than 3% early Tuesday after a slew of countries grounded the 737 Max 8 aircraft.
- On Sunday, Boeing’s 737 Max 8 was involved in its second disaster in five months.
- Boeing’s stock continues to weigh on the Dow Jones Industrial Average, shaving off more than 1100 points.
- Watch Boeing trade live.
Sunday’s crash of a Boeing 737 Max 8 aircraft operated by Ethiopian Airlines continued to pressure Boeing’s stock Tuesday morning, with shares trading more than 3%. Boeing shares are under pressure for a second after sliding 5.3% on Monday.
The sell-off in Boeing, which commands a weighting of more than 10% of the Dow Jones Industrial Average, has wiped out more than 100 points from the index on Tuesday. Monday’s losses wiped out 81 Dow points. The Dow, which was down almost 50 points points in Tuesday early trading, would have been trading higher if not for Boeing’s losses. Boeing had previously driven 30% of the gain in the Dow this year.
The Dow is a price-weighted index, meaning the company with the highest share price has the heaviest weighting. Even with Tuesday’s losses, Boeing’s stock price remained the highest in the index, at $US385.
Unlike the Dow, the S&P 500 is weighted by market cap, meaning the largest company, Microsoft, has the heaviest weighting. By comparison, Boeing commands the 15th-biggest weighting of S&P 500 names.
Both Sunday’s crash of an Ethiopian Airlines flight, which killed all 157 on board, and the fatal crash of a Lion Air flight in Indonesia in October involved Boeing’s 737 Max 8 plane. More than a dozen airlines as well as the governments of China, Indonesia, Australia and Singapore have grounded the aircraft. Boeing has more than 5,000 orders outstanding for the 737 Max 8 aircraft, which is expected to be a large driver of business in the years ahead.
Boeing’s stock was up 20% this year after Tuesday’s sell-off.
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