Boeing Stock Rises Premarket: Trump Floats Using Planemaker As Negotiating Tool

Boeing stock (BA) rose nearly 15% in early premarket trading on Monday after U.S. President Donald Trump indicated that Washington, D.C., could slap restrictions on aircraft shipments to China, amid a spike in tensions between the two countries.

"We have many things, including a big thing, [an] airplane. They [China] have a lot of Boeing planes, and they need parts, and lots of things like that," Trump said to reporters, according to a Reuters News report.

After a trade truce that lasted for months, trade tensions between U.S. and China mounted once again after Trump threatened to slap 100% tariffs on Chinese goods after Beijing's latest rare earth export curbs.

The trade dispute could jeopardize an expected order of about 500 jets from various airlines from Asia's biggest economy. During the earlier trade dispute between the two countries in April, Beijing had asked its carriers not to take deliveries of Boeing aircraft.

Retail sentiment for Boeing on Stocktwits was in the 'bullish' territory heading into the fresh trading week.

Despite China accounting for over a quarter of Boeing's order book earlier this century, the country's contribution to the planemaker has diminished to 5%. Chinese airlines have orders for at least 222 Boeing jets, Reuters reported citing aviation analytics company Cirium. The country reportedly has 1,855 Boeing airplanes in service, with the majority of them being from the best selling 737 series. 

However, Boeing would likely want to avoid any hiccups as it ramps up deliveries to start generating positive free cash flow. Last week, a report stated that Turkish Airlines could shift a recent order for 737 MAX jets to its European counterpart, Airbus.

Boeing stock has risen over 18% this year. 

Also See: TMQ, CRML, USAR: Lithium, Rare Earth Stocks Rally Premarket As US-China Trade Dispute Heats Up

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