What happened

After an epic sell-off Thursday, stocks came roaring back to notch big gains Friday morning. Blue chip aerospace stock Boeing (NYSE:BA), which tumbled 16.5% on Thursday, is helping lead the charge back this morning, rising 10.25% through 10:25 a.m. EDT. 

Riding its coattails are two of its biggest suppliers, Spirit AeroSystems Holdings (NYSE:SPR) and Triumph Group (NYSE:TGI), up 7% and 17.5%, respectively.

But is this rally for real or merely a dead cat bounce?

2 airplanes flying in opposite directions towards each other

Airplane supplier stocks are flying high today. Image source: Getty Images.

So what

Spirit threw investors into a panic on Thursday when it announced that key customer Boeing had instructed it to stop work on component sets for as many as 20 Boeing 737 MAX planes. Unless Boeing changes its mind, the delay in manufacturing of these crucial 737 parts could imperil as much as 16% of Spirit's revenue this year. The news also suggests that demand for the 737 in the midst of a recession isn't quite as robust as hoped.

That situation hasn't changed in a day. What has changed, and what may be encouraging investors today, are three things:

First, Spirit AeroSystems was allocated $80 million in funding by the Defense Department to shore up its ability to keep manufacturing warplanes for the Pentagon, reports TheFly.com. This won't entirely offset the delay of the MAX orders from Boeing, but it should help.

Second, Triumph Group has filed notice with the Securities and Exchange Commission of its intention to raise $600 million in new capital through stock and debt issuances, boosting its own liquidity and ability to withstand a sales slump.  

And third, American Airlines Group (NASDAQ:AAL) just announced that it is ahead of schedule on reducing its cash burn, which has declined from $100 million a day in April, to a projected $40 million per day by the end of this month. And the airline says it is on track to completely end cash burn by the end of this year.  

Now what

If American's news is a harbinger of improvements by other carriers, then a healthier airline industry would appear to be great news further up the supply chain for Boeing, Spirit AeroSystems, and Triumph Group.

But part of the reason American Airlines says it's been able to cut its cash burn is because it has "removed more than $13.5 billion from its operating and capital budgets for 2020." So it would appear that American's financial improvement will depend in large part on the airline buying fewer airplanes from Boeing (which relies on selling commercial jets for 42% of annual revenue).

American's improvement will also depend on spending less on airplane maintenance. And 24% of Boeing's revenue comes from providing maintenance and other global services, which is its most profitable business segment, S&P Global Market Intelligence reports.

So although healthier airlines should be good news for Boeing and its suppliers, the devil could be in the details.