Airline stocks were mixed Tuesday as the broader market stumbled, a ratings agency said airlines may experience a weak cyclical recovery next year, and United announced a big order of new planes.
The Dow Jones industrial average fell 98 points, or just under 1 percent, to around 10,292 in afternoon trading, and other indexes dropped as well.
Dropping oil prices offered a respite for airlines. Benchmark crude for January delivery fell $1.31 to settle at $72.62 a barrel on the New York Mercantile Exchange. Oil prices matter to airlines because they affect jet fuel costs.
Fitch Ratings said Tuesday that after two years of volatile energy prices and weak demand, the largest U.S. airlines approach 2010 with "guarded hopes that a slow but sustained recovery in margins and cash flow generation" will boost carriers' balance sheets and credit ratings.
Fitch said signs point to "a still-weak cyclical revenue recovery for the industry in 2010."
United Airlines announced it will buy 50 new jets from Boeing _ including the new 787 _ and Airbus, with list prices totaling more than $10 billion.
It was United's first major jet order in 11 years. But the airline opted to buy smaller planes than the ones they will replace _ an apparent hedge against future weak travel demand.
The Amex airlines index slipped 0.5 percent, with six of its components higher, six lower and one unchanged in afternoon trading.
Shares of United parent UAL Corp. rose 5 cents to $9.88; Alaska Air Group Inc. gained 19 cents at $32.75; AirTran Holdings Inc. rose 7 cents to $5.14; Southwest Airlines Co. lost 1 cent at $10.08; and JetBlue Airways Corp. picked up 4 cents at $5.78.
Delta Air Lines Inc. fell 27 cents, or 2.7 percent, to $9.89; American Airlines parent AMR Corp. dropped 23 cents, or 3.2 percent, to $7.02; and US Airways Group Inc. dipped 9 cents to $4.56.
Continental Airlines Inc. was unchanged at $15.90.