Boeing (NYSE: BA) encountered a notable setback on January 8, with its shares plummeting to $229, marking the lowest point in over a month.
This decline follows yet another issue surfacing concerning the beleaguered 737 Max model, raising concerns among investors regarding potential further business setbacks for the aerospace giant.
Is this recent dip a temporary pullback for BA stock or an indicator of a more extensive bear market for the world’s second-largest jet manufacturer?
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What caused BA’s stock drop?
The latest downswing in Boeing’s shares comes after one of the company’s planes, 737 MAX 9, was forced to make an emergency landing after a part of the jet’s wall detached mid-air, leaving a significant hole in the side of the vehicle.
Expectedly, the incident led to immediate action from the Federal Aviation Administration (FAA), with the regulator ordering all 737 Max 9 jets to be grounded until the investigation into the issue is concluded. The move applies to 171 planes around the globe.
The event represents the latest in a series of problems for Boeing’s 737 Max. The company has been grappling with significant financial challenges since the narrow-body airliner got globally grounded after two fatal crashes in 2019 that killed 346 people.
Will Boeing stock keep dropping?
Boeing’s significant nosedive on Monday made it the worst performer of the Dow Jones Industrial Average (DJIA), with the planemaker accounting for nearly all declines witnessed by the blue-chip index on the day.
At the current price, the stock is hovering above a near-term support zone between $221.6 and $224. Losing that ground would clear the way for further declines toward a key confluence support area between $215.27 and $213.94, where the 100-day and 200-day moving averages (MAs) are located, respectively.
A drop below this territory would allow the bears to attack the support at $200.
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