The Rolls-Royce share price ended the week lower even after positive signs about the aerospace industry. The stock ended the week at 107.32p, which was lower than the weekly high of 112.70p. It is also 16.7% below the highest level this week.
Rolls-Royce news: Rolls-Royce Holdings is one of the biggest manufacturers of aircraft engines in the world. The company’s biggest customers are companies like Airbus and Boeing.
Unlike other jet engine manufacturers, Rolls-Royce makes most of its money from the service contracts it enters with airlines that use its engines. Therefore, the stock struggled in the past few months because governments forced airlines to suspend their operations.
But there are signs that the aviation industry is having a strong recovery. In a recent update, Airbus announced that it was seeing more demand for its products. The company has even started ramping up production. Similarly, shares of General Electric, another leading engine manufacturer have risen to the highest level in more than 3 years. Meanwhile, air traffic is rising globally as countries reopen.
At the same time, Rolls-Royce received some good news last week when United Airlines announced that it would acquire supersonic planes from Boom Technologies. The company is expected to start flying the planes in 2029. This was important news for Rolls-Royce since it is the engine manufacturer of the jet.
Rolls-Royce share price forecast
My last outlook of the Rolls-Royce share price did not turn out right. In the report, I predicted that the stock would jump after the strong performance of GE.
Turning to the four-hour chart, we see that the shares have formed a rectangular channel. The stock is along the 25-day exponential moving average and slightly below the 23.6% Fibonacci retracement level. Therefore, while the outlook for the RR share price is bullish, we can’t rule out a situation where it drops to the lower side of the channel at 100p.
RR share price chart
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