Stocks – Boeing Plummets in Premarket After Bailout Request
By Geoffrey Smith
Investing.com — Stocks in focus in premarket trading on Wednesday, March 18th. The market is expected to open with further heavy losses as investors price in the risk of a sharp U.S. recession. Treasury Secretary Steven Mnuchin warned on Tuesday that the jobless rate could hit 20% in a worst-case scenario, damping the effect of an earlier announcement of a stimulus package worth up to $1.2 trillion.
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- 8:21 AM ET: Boeing (NYSE:) stock fell 16.8% after the company said it would ask the government for up to $60 billion in support for the aerospace sector.
- Boeing has spent $43 billion on share buybacks since 2013, a figure that may put pressure on the government to dilute current shareholders heavily as part of any taxpayer-funded bailout.
- 8:26 AM ET: Tesla (NASDAQ:) stock was down 9.1% after Alameda County authorities ordered it to halt production at its Fremont factory in the San Francisco Bay Area, which has been under lockdown for all but essential business since the weekend.
- 8:33 AM ET: SoftBank (OTC:) ADRs were down 11.3% after the Japanese venture capitalist was reported to be looking at ripping up its bailout plan for WeWork.
- The Wall Street Journal reported that Softbank thinks regulatory investigations into the company give it the legal cover not to cash out existing shareholders, including founder Adam Neumann.
- The WSJ said Softbank is standing by its commitment to provide liquidity to the troubled company.
FedEx (NYSE:) stock was down 3.4%, outperforming the broader market, after meeting expectations with its latest quarterly results.
The company still pulled its guidance for the rest of the year due to the coronavirus pandemic, but is perceived as being well placed to cash in on the surge in delivery-shopping as wider parts of the U.S. are subjected to public health measures.
8:45 AM: Ford Motor (NYSE:) was down 6.2% and General Motors (NYSE:) stock was down 6.9% after the companies agreed a reduction in working schedules at their plants with the United Auto Workers union.
Fiat Chrysler (NYSE:), which has already suspended production at its European plants was down 10.9%.
9:02 AM: Blue Apron (NYSE:) stock was up 41.2%, adding to Tuesday’s gain of 71%, on expectations that the online meal-kit maker will profit from the closure of restaurants across the country.
Grubhub (NYSE:) stock, which rose 12.1% Tuesday on similar hopes, was down 4.4%.
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