Why Airline Stocks Are Soaring Today
On Tuesday, stocks enjoyed their second straight day of gains as investors appear to see glimmers of hope that the worst of the rate hikes are now behind us and a so-called hard landing can be avoided. Airline stocks, which tend to perform poorly during a recession, are taking off on the thought that a downturn can be avoided.
Shares of American Airlines Group (NASDAQ: AAL) and Delta Air Lines (NYSE: DAL) are leading the way, each up more than 8% as of 11 a.m. ET on Tuesday, with shares of United Airlines Holdings (NASDAQ: UAL), Southwest Airlines (NYSE: LUV), Alaska Air Group (NYSE: ALK), and JetBlue Airways (NASDAQ: JBLU) all up more than 5% apiece.
The recently concluded third quarter was a tough one for airline stocks, with the entire group listed above down between 31% and 38% due to growing fears about the potential for a recession. The Federal Reserve has made it clear it will not stop raising rates until it is confident that inflation is under control. By definition, the Fed's actions are trying to cool the economy. The fear among investors was that the cooling would go too far, causing the economy to stall.
Source Fool.com
