The airline sector is posting strong gains for a second consecutive day, as oil prices continue to slide and after a slew of companies reported their July traffic numbers.
AMR Corp. (AMR), UAL Corp. (UAUA) and US Airways Group, Inc. (LCC) all rose about 10% on Tuesday and also issued reports on their July traffic statistics.
Contentintal Airlines Inc. (CAL) and TAM SA (TAM) each were up about 8%, while Northwest Airlines Corp. (NWA), Delta Air Lines Inc. (DAL) and Jetblue Airways Corp. (JBLU) also posted notable gains.
After the closing bell on Monday, AMR Corp. subsidiary American Airlines reported a July load factor of 85.8%, a decline of 2.0 points from in the same period last year.
Traffic decreased 3.5% to 12.46 billion Revenue Passenger Miles, or RPMs, from 12.91 billion RPMs in the same period last year. Capacity decreased 1.2% to 14.52 billion Available Seat Miles, or ASMs, from 14.70 billion ASMs in the July 2007 period.
At the same time, American Eagle, another unit of AMR Corp., reported that its July traffic declined 9.1% to 761.73 million passenger miles from 837.69 million passenger miles last year.
Capacity fell 0.9% to 1.04 billion seat miles from 1.05 billion seat miles in the year-ago month.
Load factor for July decreased 6.5 points to 73.1% from 79.6% in the prior year month.
American Eagle boarded 1.8 million passengers in July 2008.
Tuesday after the closing bell, United Airlines, a unit of UAL Corp., said that its July total scheduled revenue passenger miles or RPMs decreased in by 4.0% on a capacity decrease of 1.4% in scheduled available seat miles or ASMs compared with the same period in 2007.
The airline said its July traffic declined 4.0% to 10.49 billion revenue passenger miles or from 10.92 billion RPMs in the same period last year.
The airline's July available seat miles or capacity was 12.33 billion, down 1.4% from 12.50 billion in the prior year period.
Load factor for July 2008 was 85.0%, down 2.3 points from 87.3% in July 2007.
UAL Corp. also announced that James Keenan has been named senior vice president of United Services.
Before the opening bell on Tuesday, US Airways reported July and year-to-date 2008 traffic results. Mainline revenue passenger miles or RPMs for July were 5.9 billion, down 0.8% from July 2007. Capacity was 6.9 billion available seat miles or ASMs, up 0.4% compared with last year. Passenger load factor for the month was 85.1%, down 1.2 points versus July 2007. Also, July US Airways' preliminary on-time performance as measured by the DOT was 78.4%, with a completion factor of 98.3%.
Crude oil pared a good portion of its daily losses but remained lower for the session. Light sweet crude moved to $120.69, down 72 cents on the session. Prices touched as low as $118 in the electronic trading. Oil has seen sharp weakness in recent weeks as demand has fallen with prices at previously-unseen levels.
By 12:55 pm Eastern Time, shares of AMR Corp. were up 96 cents at $10.65 per share, while UAL Corp. stock was up 74 cents at $9.67 and shares of US Airways were up 55 cents at $6.23.
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