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$IG heavyweight, Boeing, under focus after FAA production cap

TRANSPORTATION

For $ investors in Boeing (Baa2, BBB-; S) Moody's today; "FAA's decision to allow the 737 MAX 9 to promptly return to service is a step forward for the MAX program; however, the cap on the current production rate is two steps back and decidely credit negative. Moody's Baa2 senior unsecured rating and stable outlook are unaffected at this time."

* Regardless Boeing equities didn't take it well yesterday (paring some losses today) - analyst mixed on the financial impact given no clear indicator on the duration of the production halt.

* Bigger impact on Spirit Aerosystems; its equities are still down 6% since the statement - Citi analyst saw the remarks biased to indicating manufacturing & not a design fault. It's $1.2b Nov 30's (B3 Neg, B- Neg) have traded surprisingly well - $ CCC's trade at 12.7% (shorter/4yr maturity) - we don't see any recent rating action - its been on double Neg. since December.

Boeing reports Q4 results on Wednesday (pre-market) & Spirit AeroSystems on the 6th of Feb

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