Boeing, Brexit and bounces Boeing, Brexit and bounces Boeing, Brexit and bounces

Boeing, Brexit and bounces

Equities 4 minutes to read
Michael McKenna

Head of Editorial Content, Saxo Bank

Summary:  The crash of an Ethiopian Airlines Boeing 737 MAX has sent the company's shares down 9.7% as aviation authorities in several countries grounded future flights of the aircraft. In the FX space, meanwhile, the day's trading has a singular focus: Brexit.


Boeing (BA: NYSE) shares have fallen 9.7% in the wake of the Ethiopian Airlines 737 MAX crash on March 10. Prices were $422.54 at the close on Friday versus $381.00 this morning. The drop comes on the heels of news that the UK joined China, Singapore, Indonesia, Australia and six other airlines in grounding 737 flights. Boeing isn’t concerned about the quality of its aircraft, released a statement yesterday claiming “the 737 MAX is a safe aeroplane that was designed, built and supported by our skilled employees who approach their work with the utmost integrity.”

Before the accident, the stock was considered a strong “buy” by analysts with a consensus target price of $454.50. The Dow Jones Industrial Average (DJIA) has turned early losses into gains as of 14:30 GMT but is lagging the moves in the S&P 500 (+0.49%) and NASDAQ (+0.34%).

Brexit headlines have played ping-pong with GBPUSD. Prices have traded erratically in a 1.3006-1.3151 range since the New York open. A spokesman for Ireland’s Democratic Unionist Partysaid it wouldn’t back the latest plan because “sufficient progress” has not been achieved. UK Attorney General Geoffrey Cox said the legal risk “remains unchanged” but recommended MPs vote for the deal. The debate in Parliament is ranging, and GBPUSD is bouncing in a 1.3090-1.3140 range.

WTI oil prices are continuing this week’s slow grind higher, although today’s price action has been choppy. WTI bounced in a $56.90-$57.50/barrel range since the New York open. Prices are underpinned by news that the senior US and Chinese trade representative are still talking, and that overall trade talks are progressing. 

The oil price rally has put downward pressure on USDCAD which has slipped from its New York opening level of 1.3402 to a low of 1.3372. However, losses may be limited to support in the 1.3270-1.3340 area. 
USDCAD
USDCAD (four-hour, source: Saxo Bank)
Disclaimer

The Saxo Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-hk/legal/disclaimer/saxo-disclaimer)

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo or its affiliates.

Saxo Capital Markets HK Limited
19th Floor
Shanghai Commercial Bank Tower
12 Queen’s Road Central
Hong Kong

Contact Saxo

Select region

Hong Kong S.A.R
Hong Kong S.A.R

Saxo Capital Markets HK Limited (“Saxo”) is a company authorised and regulated by the Securities and Futures Commission of Hong Kong. Saxo holds a Type 1 Regulated Activity (Dealing in Securities); Type 2 Regulated Activity (Dealing in Futures Contract); Type 3 Regulated Activity (Leveraged Foreign Exchange Trading); Type 4 Regulated Activity (Advising on Securities) and Type 9 Regulated Activity (Asset Management) licenses (CE No. AVD061). Registered address: 19th Floor, Shanghai Commercial Bank Tower, 12 Queen’s Road Central, Hong Kong.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products may result in your losses exceeding your initial deposits. Saxo does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo does not take into account an individual’s needs, objectives or financial situation. Please click here to view the relevant risk disclosure statements.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-hk/about-us/awards.

The information or the products and services referred to on this site may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and services offered on this website are not directed at, or intended for distribution to or use by, any person or entity residing in the United States and Japan. Please click here to view our full disclaimer.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc. Android is a trademark of Google Inc.