Investors Crush Boeing Before Tariffs Bite...
The downdraft is being widely attributed to the potential effects on the company of the newly established tariffs by the Trump administration.
Dow Jones Industrial component, Boeing (BA) declined a serious 6.56% on Tuesday.
It is significantly underperforming the 30-stock average, which closed lower by 1.6%. Boeing is a big aerospace and defense firm with a market cap of $119 billion.
The downdraft is being widely attributed to the potential effects on the company of the newly established tariffs by the Trump administration.
The daily price chart is here.
You can see how dramatic Tuesday’s gap down is with a complete red candlestick entirely below the 200-day moving average. Also, this lower price makes it five straight closes below what is now a down trending 50-day moving average.
Daily price chart
The straight down quality is apparent as the selling took the stock below the level of the previous support from the January low and just kept going without looking back.
Tuesday’s volume was 15.6 million shares traded, almost double Boeing’s average daily volume of 8.89 million, a sign of the intensity of the dumping.
February’s high of just above $187.50 failed to reach as high as the late July peak of near $197.50.
Although the 50-day moving average crossed above the 200-day moving average in early February, it’s hard to see how that typically bullish kind of signal can be relied on in this instance.
Support lies at the early December low just above $152.50 and if that’s taken out, the next level is likely down near the mid-November low of $137.50.
The weekly price chart is here.
The extent of the volatility is easy to see: from the 2022 lows near $120 up to the late 2023 highs above $260 and then back to the $140 area by November 2024.
Weekly price chart
The oddness is clear when you see how the 50-week moving average crossed above the 200-week moving average in September 2023 and, just a few months later, crossed below it in late July 2024.
Dow Jones Industrial stocks move around, of course, but Boeing takes the cake for volatile month-to-month action.
Earnings this year are up 94% but the past five years EPS is a negative 74%.
The UK-based investment firm Barclays in early February upgraded its opinion of the stock from “equal weight” to “overweight” with a price target of $210.
Boeing is dealing with a 25% tariff on basic goods imported from Canada and Mexico, a 10% tariff on energy materials from Canada and an increase to 20% on goods from China.
Investors are not waiting to find out how it all plays out for Arlington, Virginia-based company.
Charting the markets!
John Navin
Analyst, The Flash Report
Stats courtesy of FinViz.com. Charts courtesy of Stockcharts.com.
Not investment advice. For educational purposes only.
