Seattle, Washington – Shares of Boeing slid 8.4% in premarket trading on Monday following the Federal Aviation Administration’s (FAA) temporary grounding of dozens of Boeing 737 Max 9 aircraft. The FAA’s emergency airworthiness directive will impact approximately 171 planes worldwide and applies to U.S. airlines and carriers operating in U.S. territory. The grounding came after a piece of the aircraft blew out during an Alaska Airlines flight. In response to the grounding, Alaska and United Airlines announced that they would be grounding their entire fleets of Boeing 737 Max 9s.
On a different note, BlackRock, the asset management giant, released details about the proposed fee for its bitcoin exchange-traded fund (ETF). BlackRock stated that its ETF would have an annualized fee of 0.30%, with a temporary waiver reducing the fee to just 0.20% for the first $5 billion of assets during the fund’s first year. Another bitcoin ETF, the Ark 21Shares Bitcoin ETF, is proposing an even lower fee, with a temporary waiver that would bring the fee down to zero for the first six months or the first $1 billion in assets. This price reduction suggests increasing competition in the ETF market.
Meanwhile, Lululemon, the athleisure company, saw a decline in its premarket trading despite raising its fourth-quarter earnings guidance. The company now projects earnings per share between $4.96 and $5, up from a previous range of $4.85 per share to $4.93 per share. Lululemon’s balanced sales trend across channels, categories, and geographies contributed to their guidance increase.
In another news, the electric vehicle (EV) manufacturing arm of China Evergrande, Evergrande New Energy Vehicle, called for a trading halt due to an impending company announcement. The nature of this announcement has not been disclosed. Last week, Evergrande NEV’s shares fell over 18% after the company announced the cancellation of its planned share sale to U.S.-listed NWTN.
Furthermore, the Bank of Korea is expected to hold interest rates steady at 3.50% during its first central bank meeting of the year. Despite market speculations of a possible easing, HSBC economist Jin Choi expects the central bank to retain its restrictive policy stance due to persistently high inflation. The Bank of Korea’s inflation target is 2%.
Lastly, congressional leaders reached a $1.59 trillion deal on top-line spending in order to prevent a potential government shutdown. This agreement comes as the U.S. government races against time to reach a deal and secure funding.
In summary, Boeing’s shares took a hit following the FAA’s temporary grounding of its 737 Max 9 aircraft. BlackRock and the Ark 21Shares Bitcoin ETF revealed their proposed fees, with the latter offering an even lower fee to compete in the market. Lululemon, despite raising its fourth-quarter earnings guidance, experienced a decline in premarket trading. Evergrande New Energy Vehicle called for a trading halt ahead of a company announcement. The Bank of Korea is expected to hold interest rates steady, and congressional leaders reached a deal on top-line spending to avoid a government shutdown.