Trump's grounding of Boeing 737 Max jets trims stock market gains

President Trump's announcement Wednesday that he is grounding Boeing's 737 Max 8 and Max 9 jet fleet in the U.S. reduced gains the stock market had made earlier in the day's session.

The president's action means the U.S. joins a slew of other nations in banning the aircraft after a second fatal crash on Sunday involving an update to the Chicago-based manufacturer's most popular plane. That crash, which left all 157 people on board the 737 Max 8 jet dead comes just five months after another such aircraft crashed in Indonesia, killing all 189 people on board.

"We are going to be issuing an emergency order of prohibition to ground all flights of the 737 MAX 8 and the 737 MAX 9 and planes associated with that line," Trump said.

Immediately after the announcement, shares of Boeing and one of its main customers, Southwest Airlines, fell hard but then regained some of their earlier gains.

Ticker Security Last Change Change %
BA THE BOEING CO. 170.48 +0.66 +0.39%
LUV SOUTHWEST AIRLINES CO. 29.73 +0.35 +1.19%

The Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite also retreated before recouping some of the losses and remaining in positive territory.

Several factors kept investor sentiment positive. The U.S. Trade Representative Robert Lighthizer told a Senate panel that U.S.-China trade talks were near their conclusion and European stocks posted gains.

"Our hope is that we are in the final weeks of having an agreement," he told the Senate Finance Committee on Tuesday.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 38402.82 +162.84 +0.43%
SP500 S&P 500 5051.94 +41.34 +0.83%
I:COMP NASDAQ COMPOSITE INDEX 15622.975584 +171.67 +1.11%

His comments, plus soft inflation data, helped offset concerns about the U.K.'s Brexit issues and prospects for the global economy to slow its rate of growth.

In addition, strength in two sectors also helped keep the major averages in positive territory. Oil and mining companies rose, helping offset weakness in retail issues.

Ticker Security Last Change Change %
DVN DEVON ENERGY CORP. 52.13 +0.30 +0.58%
APA APA CORP. 32.47 +0.11 +0.34%
MNST MONSTER BEVERAGE CORP. 53.60 +0.46 +0.87%

Investors also remained concerned about the European Central Bank's downward revisions in its forecast for global economic growth and inflation.

At the heart of that downward revision are signs that China's rate of growth is slowing, the result of the U.S.-China trade dispute.

Asian stocks ended the day lower. Japan's Nikkei 225 closed down 0.99 percent, the Hang Sang ended lower by 0.39 percent and the Shanghai Composite was off 1.09 percent.


European equities traded higher. The FTSE 100 was up 0.1 percent, Germany's DAX gained 0.5 percent and France's CAC 40 added 0.7 percent.