Dow Nosedives Because Boeing Scandal Refuses to Go Away

October 18, 2019 17:02 UTC

The Dow Jones Industrial Average accelerated its decline on Friday afternoon, careening toward losses of around 200 points in response to the latest development in a Boeing scandal that refuses to go away.

Dow Downturn Puts Weekly Gains at Risk

Shortly before 1 pm ET, the Dow had lost 190.37 points or 0.7%, dropping the index down to 26,835.51.

Boeing stock dragged the Dow to substantial losses. | Source: Yahoo Finance

After closing at 26,816.59 last Friday, the index now risks sliding into decline for the week.

The Dow had been under pressure all morning due to weakness in several core stocks, but it was the DJIA’s most heavily weighted component – Boeing – that caused the index to suffer the most damage.

Boeing shares slid 3.6% to $355.77, underperforming 28 of the Dow’s other 29 components. Only Johnson & Johnson stock (-5.07%) fared worse.

Boeing stock struggled after Reuters published a report indicating that employees had allegedly misled regulators about the safety of the 737 Max. | Source: Yahoo Finance

Reuters: Boeing Misled FAA About 737 Max Safety

Boeing’s decline followed a Reuters report that employees of the US aerospace giant had misled aviation regulators about the safety of the 737 Max, which was involved in two fatal crashes in October 2018 and March 2019.

According to the report, instant messages from 2016 reveal that Boeing employees deliberately the Federal Aviation Administration (FAA) about a “key safety system” on the 737 Max, which was the fastest-selling airplane in the company’s history before its worldwide grounding seven months ago.

Boeing discovered the messages “some months ago,” the report said, but just yesterday disclosed them to the FAA, who described them as “concerning.”

Click here for a live Dow Jones Industrial Average chart.

This article was edited by Sam Bourgi.

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@Y3llowb1ackbird

Josiah is the US Editor at CCN, where he focuses on financial markets. He has written over 2,000 articles since joining CCN in 2014. His work has also been featured on ZeroHedge, Yahoo Finance, and Investing.com. He lives in rural Virginia. Follow him on Twitter @y3llowb1ackbird or email him directly at josiah.wilmoth(at)ccn.com.