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Boeing CEO ouster stirs markets out of holiday lethargy

Boeing CEO ouster stirs markets out of holiday lethargy

Logo of the London Stock Exchange.

LONDON: The shock announcement that Boeing ousted its embattled CEO invigorated Wall Street, while trading was muted on European and Asian stock markets as many investors were already away for Christmas.

Boeing said the leadership change was needed to "restore confidence" and "repair relationships with regulators, customers and all other stakeholders" and the news sent the Dow member's share price jumping 2.5 per cent.

Still, at around US$336, the share is considerably off from the US$446 it struck earlier this year as the aircraft manufacturer has been unable to deliver a quick fix to the problem seen behind the crash of two 737 MAX airliners.

Dennis Muilenburg was replaced by board Chairman David Calhoun because the grounding of the MAX has dragged on far longer than initially expected as more disturbing details have dribbled out about its certification.

"The industrial giant is trying to put the 737 MAX catastrophes behind it, and the removal of Muilenburg is a part of that strategy, but the group will find it tough to shake off the reputation of the two disasters," said market analyst David Madden at CMC Markets UK.

Meanwhile, more positive news on the US-China trade front also boosted sentiment.

Beijing said it will lower import tariffs on more than 850 products including frozen pork from next month.

And while the move does not appear to be linked to the bruising trade war between China and the US, which has seen Washington and Beijing exchanging levies on goods worth hundreds of billions of dollars, it will likely help reduce tensions.

"The news that Beijing will reduce their levies on more than 850 US imports next month has lifted the mood on Wall Street," said Madden.

In Europe trading was muted, which many investors taking a break for the holidays.

"It's been a strong run up to Christmas for the stock markets and it seems traders are taking a little breather in this shortened trading week," said analyst Craig Erlam at trading firm Oanda.

"It's been a good few weeks for investors, spurred primarily by the de-escalation in the trade war, with Trump ... claiming it will be signed very shortly."

Global equities have enjoyed a flourish as they head towards the end of the year, having been on a roller-coaster ride for 12 months owing to the long-running trade row and Brexit.

And observers say that with those two major issues cleared up for now, 2020 could see a healthy run-up in prices, boosted by looser central bank monetary policy and signs of improvement in economies around the world.

With very little by way of market-moving events on the horizon, analysts are expecting a quiet week.

Key figures around 1630 GMT:


London - FTSE 100: UP 0.5 per cent at 7,623.59 points (close)

Frankfurt - DAX 30: DOWN 0.1 per cent at 13,300.98 (close)

Paris - CAC 40: UP 0.1 per cent at 6,029.37 (close)

EURO STOXX 50: UP less than 0.1 per cent at 3,778.11


Tokyo - Nikkei 225: FLAT at 23,821.11 (close)

Hong Kong - Hang Seng: UP 0.1 per cent at 27,906.41 (close)

Shanghai - Composite: DOWN 1.4 per cent at 2,962.75 (close)


Pound/dollar: DOWN at US$1.2923 from US$1.2999 at 2200 GMT

Euro/pound: UP at 85.82 pence from 85.23 pence

Euro/dollar: UP at US$1.1089 from US$1.1079

Dollar/yen: DOWN at 109.39 yen from 109.44 yen


Brent North Sea crude: UP 0.4 per cent at US$66.57 per barrel

West Texas Intermediate: up 0.2 per cent at US$60.57 per barrel

Source: AFP/de


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