Shares of Boeing fell as much as 8 percent on Monday following news of a deadly plane crash involving a 737 MAX 8, which affected exchange-traded funds (ETFs) like the iShares US Aerospace & Defense ETF (BATS: ITA).
With a 13.03 percent weighting in Boeing, ITA was down 1.29 percent as of 12:30 p.m. ET.
ITA tracks the Dow Jones U.S. Select Aerospace & Defense Index composed of U.S. equities in the aerospace and defense sector that includes manufacturers, assemblers and distributors of aircraft and aircraft parts. After declining 7.21 percent in 2018, ITA is up 20.98 percent thus far in 2019, according to Morningstar performance figures.
The crash of Ethiopian Airlines Flight 302 took place shortly after takeoff, taking the lives of all 157 people on board. It was the second deadly crash in span of less than six months involving a 737 MAX 8, which is Boeing’s top-selling plane.
Last October, a 737 MAX 8 operated by Indonesian carrier Lion Air fell into the Java Sea just shortly after takeoff, taking all 189 lives on board. Ethiopia, China and Indonesia were among the countries that were quick to ground Boeing 737 MAX 8 planes with regard to safety concerns.
In the meantime, airlines followed suit like Ethiopian Airlines and Cayman Airways. Flight attendants and members of the public took to Twitter to voice their concerns or request to change flights involving Boeing 737 MAX 8 planes.
@SouthwestAir Just read that you have more of the 737 Max 8 planes in your fleet than any other airline. Are you taking them out of operation based upon the Ethiopian and Indonesian tragedies? Please say YES! #airlinesafety #EthiopianAirlinesCrash
— Del Boyette (@Del_Boyette) March 11, 2019
.@AmericanAir I called & was told waivers are not available as I have a non-refundable fare as do the majority of passengers. This is NOT ACCEPTABLE esp. when some airlines are grounding the 737 Max 8 due to safety concerns. This is a American Airlines customer service failure. https://t.co/ifMmPpJHdp
— Sandy (@nycsandygirl) March 11, 2019
Hey @united, I’m flying 737-800 this month with you. Do you make a distinction between that and the MAX on your tickets/flight info? I wouldn’t feel comfortable on a MAX of any kind (the issues could be the same across the 7,8,9). I know you fly the MAX-9. https://t.co/Nbr6IAyRkw
— Jeremy Faust MD MS (@jeremyfaust) March 11, 2019
“Safety is our number one priority and we are taking every measure to fully understand all aspects of this accident, working closely with the investigating team and all regulatory authorities involved,” Boeing said in a statement. “The investigation is in its early stages, but at this point, based on the information available, we do not have any basis to issue new guidance to operators.”
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