There have been times in recent years when I have wondered if Boeing (BA) would ever recover from its own grievances and the COVID-19 pandemic. Well, BA and its peer group, the Aerospace ($DJUSAS), literally “flew” to the end of 2022. Check out this chart:
If you were wondering how the S&P 500 held up above the October low despite all the weakness seen over the past two months in areas like technology (XLK), consumer discretionary (XLY) and communications services (XLC), That’s because the money flowing out of these three sectors doesn’t leave the stock market. It spins!
Previously struggling sectors like aerospace are suddenly booming as tech money finds new homes in other stock markets. This is crucial to ending cyclical bear markets. Instead of pure distribution we see rotation. As technicians, we have to pay attention to where the money goes. Right now, investors and traders are seeing a lot of value in aerospace and in individual stocks like BA.
There’s another HUGE potential catalyst for BA in 2023. I believe BA will reintroduce its quarterly dividend in 2023, or at least there will be more discussion of that possibility. BA hasn’t paid a dividend since the pandemic began, but before that it was a steady dividend grower. Add in improving fundamentals with a return in quarterly dividends along with the already improving technical outlook and BA could be poised to lead the aerospace industry to big gains in 2023.
Speaking of 2023, our MarketVision 2023 event, The Road Ahead: Navigating An Uncertain Market, takes place this Saturday, January 7th, giving you a roadmap of what we expect to see in the year ahead. Join me and my friends and colleagues at StockCharts.com – David Keller, Julius de Kempenaer and Grayson Roze – as we analyze the action of 2022 and share our strategies and thoughts as we head into 2023. It is a FREE virtual event, but requires pre-registration. CLICK HERE for more information and details about MarketVision 2023. Hope to see you there!
Happy New Year and happy trading!
Tom
Tom Bowley is the Chief Market Strategist of EarningsBeats.com, a company that provides a research and education platform for both investment professionals and individual investors. Tom writes a comprehensive Daily Market Report (DMR) that provides guidance to EB.com members every day the exchange is open. Tom has brought technical expertise here at StockCharts.com since 2006 and also has a fundamental public accounting background which brings him unique skills to approach the US stock market.
