737 Plane Crash In Southern China Drops Boeing’s Shares By 4.5%

In the early hours of Monday, a 737-800 Boeing aircraft of China Eastern Airlines (600115.SS), with 132 people on board, crashed in the mountains of southern China.

The plane reportedly crashed after a sudden descent from cruising altitude and till now, rescue workers are yet to find any sign of survivors.

The Civil Aviation Administration of China confirmed the plane crash.

“On March 21, 2022, a Boeing 737 of China Eastern Airlines lost contact over Wuzhou during the Kunming-Guangzhou flight. The plane has now been confirmed to have crashed. There were 132 people on board, including 123 passengers and 9 crew members,” the agency said.

According to the Aviation Safety Network database, the crash is China’s deadliest airline crash since 1994 and the deadliest ever for China Eastern Airlines.

However, since the crash, Investors King gathered that the U.S. planemaker, Boeing Co (BA.N) and its suppliers recorded a drop in their shares.

While Boeing’s stock fell by 4.5% in Monday trading, American Depositary Receipts (ADR)of China Eastern Airlines (CEA) declined by 6.6%. An ADR is the U.S.-listed stock in a foreign company.

According to Reuters, parts suppliers Spirit AeroSystems Holdings Inc (SPR.N), Hexcel Corp (HXL.N) and Triumph Group Inc (TGI.N) were down between 1% and 4%.

Yahoo Finace reports that shares of the Chicago-based company were down to $184.22 each on Monday morning from $192.83 at closing on Friday afternoon.

From 2013 to 2019, Boeing spent over $60 billion on dividends and stock buybacks, twice as much as the development costs of the 787.

In 2020, Boeing’s revenue was $11.8 billion as a result of the pandemic slump. Due to higher sales in other divisions and an influx in deliveries of commercial jetliners in 2021, revenue increased 44%, reaching nearly $17 billion.

Meanwhile, Chinese state media said the airline has grounded its 737-800 fleet, which according to the flight tracking website, had 109 such planes.

Boeing is among the largest global aerospace manufacturers. It is the third-largest defends contractor in the world based on 2020 revenue, and is the largest exporter in the United States by dollar value.