Some U.S. states are beginning to slowly reopen their economies, and even hard-hit New York is planning to ease some restrictions by mid-May. The Dow Jones Industrial Average (DJINDICES:^DJI) was up 1.3% at 11:40 a.m. EDT Monday, buoyed by hopes that the novel coronavirus pandemic's effects on the U.S. economy will begin to wane in the coming weeks.
This optimism comes as the total number of cases in the U.S. approaches 1 million, according to Johns Hopkins University. Roughly 55,000 Americans have died from the virus.
Not participating in the rally on Monday were Apple (NASDAQ:AAPL) and Boeing (NYSE:BA). Apple is reportedly delaying production of its upcoming 5G iPhones, while Boeing sees a multiyear recovery in travel demand ahead.
Apple's 5G iPhones reportedly delayed
Apple successfully launched its second-generation iPhone SE this month, a budget smartphone with powerful internals and a price point that meshes well with the current economic environment. That phone is reportedly selling well.
But the launch of Apple's next flagship iPhone devices might not go so smoothly. The Wall Street Journal reported on Monday that Apple is delaying the production ramp-up of its upcoming iPhones by roughly a month. A combination of supply chain disruptions in Asia and weak consumer demand for smartphones, both caused by the novel coronavirus pandemic and the resulting social-distancing measures, have roiled Apple's typical release schedule.
The Journal reports that Apple still plans on launching four new iPhone models, some with 5G connectivity, later this year. However, the typical early-summer start of mass production will be pushed back. Apple has reportedly cut the number of phones it plans to produce in the second half of this year by as much as 20%.
If Apple manages to launch new flagship iPhones later this year, it's unclear how strong demand will be for the pricey new gadgets. While the economy is beginning to open back up in some states, the economic effects of the pandemic will likely persist for quite some time.
Apple is set to report its fiscal second-quarter results after the market closes on Thursday, April 30. Apple stock was roughly flat late Monday morning.
Boeing sees long recovery ahead
At Boeing's annual shareholder meeting on Monday, CEO Dave Calhoun predicted that the travel industry will take two or three years to fully recover. Demand for air travel has essentially disappeared amid the pandemic, putting stress on airlines and all companies that are part of the commercial jet supply chain.
Prior to the pandemic, Boeing was already dealing with the crisis created by the 737 MAX, which is still grounded following two fatal crashes. The company had set a goal of getting the plane back in the air by mid-year, but that target is looking increasingly unrealistic. Now, Boeing will have to contend with a potential multi-year slump in demand for commercial aircraft.
Boeing will report its first-quarter results on Wednesday morning. Analysts are expecting revenue to drop by nearly 25% from the prior-year period to $17.3 billion. Analysts also expect Boeing to report a net loss, down from a profit in the first quarter of last year.
Shares of Boeing were flat late Monday morning. While the stock has rebounded since bottoming out in March, it remains down 67% from its 52-week high.