AMR leads airline sector into the red as oil rises
SAN FRANCISCO (MarketWatch) — Airline stocks ended sharply lower on Tuesday as shares of American Airlines’ corporate parent led the decliners while JetBlue Airways shrugged off the brunt of the sector sell-off following a Merrill Lynch upgrade.
The Amex Airline Index (XX:$XAL: news, chart, profile) shed 3.9% to 47.28 points, with the price of crude oil closing just above $72 a barrel as traders look to the meeting of the Organization of Petroleum Exporting Countries in Caracas later this week for any move on production quotas.
JetBlue Airways (JBLU:JBLU9.67, -0.07, -0.7% ) fell 0.3% to $10.26. JetBlue was upgraded to neutral from sell as Merrill analyst Michael Linenberg said he believes investor concerns, such as increased competition, introduction of a second type of aircraft and other corporate growing pains, have already been priced into the stock.
“Furthermore, we think management is moving quickly to address these issues and anticipate some early ‘wins’ as the ‘return to profitability’ plan takes hold,” he said.
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