Sector Snap: Airline stocks mixed

AP News
Posted: Dec 07, 2009 3:13 PM

Airline stocks were mixed on Monday, a tepid response to reassuring remarks by Federal Reserve Chairman Ben Bernanke and another drop in oil prices.

Shares of the major airlines have rallied sharply since early November, and some profit-taking sales may have been inevitable.

The Amex airlines index rose 0.6 percent, with seven of its components higher and six lower in afternoon trading.

The broader market perked up Monday afternoon after Bernanke said interest rates are likely to remain low for an extended period. The comment helped reassure investors who worried that Friday's positive jobs report might push the Fed to raise rates sooner.

Oil prices fell, with benchmark crude for January delivery down 89 cents to $74.58 a barrel on the New York Mercantile Exchange. Demand for gasoline, jet fuel and diesel remained weak, and refiners were cutting production to avoid losses.

In afternoon trading, shares of US Airways Group Inc. rose 19 cents, or 4.5 percent, to $4.63; United Airlines parent UAL Corp. gained 11 cents at $9.83; and Delta Air Lines Inc. added 20 cents, or 2 percent, at $10.14.

Continental Airlines Inc. fell 90 cents, or 5.4 percent, to $15.84. The Houston-based carrier announced Monday it plans to issue $200 million in convertible senior notes, which could dilute the value of current shares.

Also, American Airlines parent AMR Corp. lost 15 cents at $7.22; and Southwest Airlines Co. dropped 15 cents to $10.08.