Boeing shares fall after grounding of Max 9 planes

Grounded

Investors are abandoning Boeing and one of its largest suppliers this morning after a terrifying malfunction at 16,000 feet this weekend in which a door panel came off a new 737 Max 9 airliner mid-flight.

Air safety officials have ordered the grounding of the Max 9, one of Boeing’s best-selling models, and airlines around the world have canceled hundreds of flights as they await instructions from regulators in the United States and elsewhere.

The last update: The NTSB said yesterday that the piece of fuselage that fell from the plane was found in a backyard in Portland, Oregon.

Boeing shares fell almost 9 percentand Spirit Aerosystems, which makes the Max 9’s door panel, or “socket,” sank in premarket operations. Shares of Boeing, a major defense contractor, had risen sharply since war broke out in October between Israel and Hamas. But its shares remain well below the levels they reached in early 2019 due to the huge buzz around the fuel-efficient Max.

The latest mishap could deal a blow to Boeing’s turnaround plan, as well as its reputation. No one was injured aboard Friday night’s Alaska Airlines flight. But it is the latest in a series of safety failures before and after two deadly crashes involving Indonesia’s Lion Air and Ethiopia in 2018 and 2019. The crashes, of different versions of the Max, were linked to a faulty computer system that overrode the pilots’ orders. . Planes were grounded around the world for nearly two years after the crashes.

737 deliveries delayed after Boeing found problems with work Spirit did on the planes last year. Boeing’s wide-body Dreamliner was also grounded as the company worked to address FAA safety concerns. “The question is what’s going on at Boeing,” John Goglia, an aviation safety consultant and plane crash investigator, told the Times.

David Calhoun, CEO of Boeing, expected 2024 to be one year back. Instead, the company canceled a leadership retreat, Bloomberg reported, and was working over the weekend with the FAA to provide its airline customers with instructions on how to inspect their planes. Boeing will hold a company-wide meeting tomorrow, at which Calhoun has said he will strengthen his focus on safety.

Questions also revolve around Alaska Airlines. The company had stopped flying that plane long distances over water due to concerns about a pressurization gauge.

THIS IS WHAT’S HAPPENING

Congressional leaders reach agreement on public spending. The deal caps top-line spending at about $1.66 trillion, in line with last year’s agreement between President Biden and Kevin McCarthy, the former speaker of the House of Representatives. But it’s unclear whether there are enough votes to win over conservatives and avoid a partial government shutdown in less than two weeks.

“Oppenheimer” and “Succession” triumph at the Golden Globes. The film about the father of the atomic bomb won five awards, making it an Oscar favorite, while “Succession” took top honors for a television series, winning four. It’s too early to say whether the awards show’s broadcaster, CBS, or its organizers, Penske Media and investor Todd Boehly, came out on top.

A commercial spacecraft is headed to the Moon. A Vulcan rocket lifted off this morning carrying a robotic lander (and the remains of Gene Roddenberry, the creator of “Star Trek”). The spacecraft, built by a joint venture between Boeing and Lockheed Martin, is the first of several launches planned this year, as a host of companies hope to erode SpaceX’s dominance in the space launch industry.

A radio and podcast giant files for bankruptcy. Audacy, the largest radio company in the United States, which owns WFAN Sports Radio and New York’s 1010 WINS, filed for Chapter 11 in Texas this weekend to reduce its debt. The company has been greatly affected by the advertising crisis.

A growing conflict between Ackman and Business Insider

Bill Ackman’s fight against elite universities has expanded in unexpected ways: The parent company of Business Insider, the publication that last week accused his wife of plagiarism, said it was reviewing its journalists’ reports in light of that coverage.

And Ackman, who loudly called for the removal of Claudine Gay as president of Harvard, intensified his campaign against his wife’s alma mater, MIT, including both its top leadership and its faculty.

Media giant Axel Springer said it would examine Business Insider’s processes. after Ackman criticized articles that said his wife, Neri Oxman, a former MIT professor, plagiarized other scholars in her 2010 dissertation. While Oxman apologized for any academic infractions and said he was requesting corrections, Ackman questioned the motivations behind cover.

Although Springer is known for taking a hands-off approach to his media outlets, which also include Politico and Germany’s Die Welt and Bild, the editor said he wanted to “ensure that our journalistic standards and values ​​are respected.” have been maintained.” (Semafor reported that some Springer executives were concerned that coverage of Oxman, who was born and raised in Israel, could be seen as anti-Semitic and anti-Zionist.)

Business Insider defended itself. The media’s global editor-in-chief, Nicholas Carlson, he wrote in an internal note who maintained the coverage of the publication. He was motivated by “truth and responsibility,” he said.

Meanwhile, Ackman has called for MIT professors’ papers to be examined for plagiarism, using artificial intelligence tools to review your work. He also suggested that similar efforts should be undertaken at other universities and on Business Insider.

The lawsuit continues her campaign against Sally Kornbluth, the president of MIT, who critics say has failed to sufficiently combat anti-Semitism on campus. (She also testified at the same Congressional hearing last month that she helped seal the fate of Gay and Liz Magill, the now former president of the University of Pennsylvania.)

New reports of Musk’s drug use raise questions about behavior

Elon Musk caused a sensation in 2018 when he smoked marijuana during an interview on Joe Rogan’s podcast, with footage of him holding a joint quickly becoming the subject of discussions about the billionaire’s behavior and internet memes.

Musk didn’t break any laws, as recreational marijuana in California, where the show was filmed, is legal. But a Wall Street Journal report accusing him of using other substances, including some illegal ones, has reignited debate over his behavior.

The directors of Tesla and SpaceX have discussed Musk’s actions. including using ketamine (for which he has said he has a prescription), LSD and psychedelic mushrooms, according to The Journal. One Tesla board member, Linda Johnson Rice, became so frustrated by the issue that she decided not to seek re-election in 2019, the report added.

Because it is important according to El Diario:

The use of illegal drugs would likely be a violation of federal policies that could jeopardize SpaceX’s billions of dollars in government contracts. Musk is intrinsic to the value of his companies, potentially putting at risk about $1 trillion in assets held by investors, tens of thousands of jobs and much of the US space program. …

In addition to violating federal contracts, any type of illegal drug use would violate company policies at both SpaceX and Tesla, and would raise questions about Musk’s executive role at publicly traded Tesla, where the board has a duty to supervise management before shareholders.

Elon Musk refuted the report, posting on his social network X that after smoking on Rogan’s show, he agreed to undergo three years of random drug testing at the request of NASA. “Not even traces were found of any drug or alcohol,” he wrote.

He then added that the media “will stop at nothing destroy

Investors don’t seem worried. Tesla shares fell only slightly in premarket trading.

“It’s like having the best bows and arrows in the age of gunpowder.”

— mike madrid, a Republican anti-Trump strategist, about Nikki Haley’s rise in fundraising from deep-pocketed backers. The former South Carolina governor’s supporters include investor Stanley Druckenmiller and metals magnate Andy Sabin (and Democratic tech entrepreneur Reid Hoffman), but Haley still trails Donald Trump in Republican primary polls by double digits. .

Next week

There’s plenty on the calendar this week to keep Wall Street busy, including JPMorgan Chase earnings and the latest inflation report. This is what you should look at.

Tomorrow: The food chain Albertsons publishes its third quarter results.

Thursday: The Consumer Price Index report for December is expected to show that headline inflation rose last month, while “core” inflation, which excludes food and fuel, cooled slightly. A more favorable reading could make markets more volatile, as Wall Street has already begun to reduce expectations of a Fed rate cut in the first quarter as inflation concerns continue.

Fast Retailing, Uniqlo’s parent company, reports quarterly results.

Friday: It’s a profit bonanza. On deck are Bank of America, Bank of New York Mellon, BlackRock, Delta Air Lines, JPMorgan Chase, UnitedHealth Group and Wells Fargo.

Saturday: Taiwan holds a crucial presidential election, as Beijing increases pressure on the self-ruled island to unify.

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