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Grounding of Boeing 737 Max jets not a big deal for airlines, S&P Global says

Tomi Kilgore

The grounding of Boeing Co.'s 737 Max jets by the U.S. and Canada on Wednesday, and by many other countries earlier this week, is "not...a major factor" for the airlines it rates, S&P Global Ratings said Thursday. The groundings came after there was a deadly crash of a 737 Max jet over the weekend, a second in less than 6 months. Among the air carriers with the most exposure to the 737 Max family of jets, shares of Southwest Airlines Co. rose 0.8% in afternoon trade Thursday, but have lost 1.5% this week; American Airlines Group Inc. tacked on 0.2% on the day and were little changed on the week; and United Continental Holdings Inc. edged up 0.1% on the day but have lost 1.3% this week. In comparison, the NYSE Arca Airline Index has tacked on 2.0% this week and the S&P 500 has gained 2.4%. "We could revise our assessment of the 737 MAX aircraft if we conclude that the recent accidents will lead to a lasting diminution of collateral value or resale liquidity, but that would not become clear for some time," S&P Global said.