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Yesterday’s 24.32% surge of Boeing (BA) stock is a credit of the company’s plan to restart its 737 Max production in May. As Boeing Chief Financial Officer Greg Smith admitted, the process will not be an easy one.
During the trading session on March 25, Boeing Co (NYSE: BA) stock skyrocketed. It closed the day at $158.73, having added 24.32%. After hours, Boeing stock price increased by another 1.81% and reached $161.61. Now in the premarket, BA stock has reached $162.01. The growth fueled investors’ optimism not only to the aircraft company (which, by the way, is showing great stock performance for the second day in a row) but to the airline industry in general.
Two weeks ago, Boeing stock was weak, resulting from the cancellation of a great number of 737 Max orders. Besides, the company announced plans to shut down its Puget Sound-area factories for a period of two weeks. The announcement was a kind of bid to rescue the falling shares, and this worked out. On March 23, Boeing shares surged more than 11% at the market close and reached at $105.62. The next day, they moved higher in the pre-market, reaching $115 (+8.88%).
Yesterday, Boeing (BA) stock continued growing. Notably, the growth was accompanied by the green movement on the market in general. The three stock market indices enjoyed gains. The Dow Jones Industrial Average gained 1,194.11 points or 5.77% and hit 21,899.02. The S&P 500 index jumped by 4.37% to 2,554.33. Nasdaq Composite has also climbed 2.47% to 7,600.75.
Boeing will Restart 737 Max Production, Good Sign for BA Stock?
Yesterday’s surge of Boeing stock is a credit of the company’s plan to restart its 737 Max production in May. As Boeing Chief Financial Officer Greg Smith admitted, the process will not be an easy one.
“It’ll be a very slow, methodical, systematic approach to warming the line up, and getting crews back in place. Priority number 1 is getting customers’ fleets back up. We don’t want to add to inventory.”
737 Max is the fastest-selling airplane in Boeing history. It was in high demand until March 2019 when two fatal crashes took place. In January this year, the Federal Aviation Administration said that Boeing 737 Max certification flights would start in the next few weeks. The company won regulatory approvals and ceased the jet production. Besides, it accrued a backlog of 400 undelivered jets. However, the outbreak of coronavirus cases in the U.S. disrupted Boeing’s plans.
Amid the coronavirus spread, Boeing decided to suspend production across the Puget Sound area for 14 days. During this period, the company will conduct additional deep cleaning activities at impacted sites. In addition, Boeing has halted shipments to its Seattle-area facilities, as there are a lot of COVID-19 cases.
The suspension will last till April 8. Meanwhile, Boeing is seeking $60 billion in U.S. government aid as a financial support for the embattled American aerospace supply chain.