United Airlines Holdings Inc – Page 2

These 20 stocks in the S&P 500 are expected to soar after rising interest rates have pushed down valuations

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Two things investors can be sure about: Nothing lasts forever and the stock market always overreacts. The spiking of yields on long-term U.S. Treasury securities has been breathtaking, and it has led to remarkable declines for some sectors and possible bargains for contrarian investors who can commit for the long term.

First we will show how the sectors of the S&P 500

have performed. Then we will look at price-to-earnings valuations for the sectors and compare them to long-term averages. Then we will screen the entire index for companies trading below their long-term forward P/E valuation averages and narrow the list to companies most favored by analysts.

Here are total returns, with dividends reinvested, for the 11 sectors of the S&P 500, with broad indexes below. The sectors are sorted by ascending total returns this year through Monday.

Sector or index	2023 return	2022 return	Return since end of 2021	1 week return	1 month return
Utilities	-18.4%	1.6%	-17.2%	-11.1%	-9.6%
Real Estate	-7.1%	-26.1%	-31.4%	-3.0%	-8.8%
Consumer Staples	-5.4%	-0.6%	-6.0%	-2.2%	-4.4%
Healthcare	-4.2%	-2.0%	-6.1%	-1.7%	-3.3%
Financials	-2.5%	-10.5%	-12.7%	-2.5%	-4.7%
Materials	1.3%	-12.3%	-11.2%	-1.9%	-7.0%
Industrials	3.5%	-5.5%	-2.1%	-1.8%	-7.3%
Energy	4.0%	65.7%	72.4%	-1.9%	-1.4%
Consumer Discretionary	27.0%	-37.0%	-20.0%	-0.6%	-5.2%
Information Technology	36.5%	-28.2%	-2.0%	0.8%	-5.9%
Communication Services	42.5%	-39.9%	-14.3%	1.1%	-1.3%

S&P 500	13.1%	-18.1%	-7.4%	-1.1%	-4.9%
DJ Industrial Average	2.5%	-6.9%	-4.5%	-1.7%	-4.0%
Nasdaq Composite Index COMP	28.0%	-32.5%	-13.7%	0.3%	-5.1%
Nasdaq-100 Index	36.5%	-32.4%	-7.7%	0.5%	-4.2%
Source: FactSet

Returns for 2022 are also included, along with those since the end of 2021. Last year’s weakest sector, communications services, has been this year’s strongest performer. This sector includes Alphabet Inc.
GOOGL
and Meta Platforms Inc.
META,
which have returned 52% and 155% this year, respectively, but are still down since the end of 2021. To the right are returns for the past week and month through Monday.

On Monday, the S&P 500 Utilities sector had its worst one-day performance since 2020, with a 4.7% decline. Investors were reacting to the jump in long-term interest rates.

Here is a link to the U.S. Treasury Department’s summary of the daily yield curve across maturities for Treasury securities.

The yield on 10-year U.S. Treasury notes

jumped 10 basis points in only one day to 4.69% on Monday. A month earlier the 10-year yield was only 4.27%. Also on Monday, the yield on 20-year Treasury bonds

rose to 5.00% from 4.92% on Friday. It was up from 4.56% a month earlier.

Market Extra: Bond investors feel the heat as popular fixed-income ETF suffers lowest close since 2007

The Treasury yield curve is still inverted, with 3-month T-bills

yielding 5.62% on Monday, but that was up only slightly from a month earlier. An inverted yield curve has traditionally signaled that bond investors expect a recession within a year and a lowering of interest rates by the Federal Reserve. Demand for bonds pushes their prices down. But the reverse has happened over recent days, with the selling of longer-term Treasury securities pushing yields up rapidly.

Another way to illustrate the phenomenon is to look at how the Federal Reserve has shifted the U.S. money supply. Odeon Capital analyst Dick Bove wrote in a note to clients on Friday that “the Federal Reserve has not deviated from its policy to defeat inflation by tightening monetary policy,” as it has shrunk its balance sheet (mostly Treasury securities) to $8.1 trillion from $9 trillion in March 2022. He added: “The M2 money supply was $21.8 trillion in March 2022; today it is $20.8 trillion. You cannot get tighter than these numbers indicate.”

Then on Tuesday, Bove illustrated the Fed’s tightening and the movement of the 10-year yield with two charts:

Odeon Capital Group, Bloomberg

Bove said he believes the bond market has gotten it wrong, with the inverted yield curve reflecting expectations of rate cuts next year. If he is correct, investors can expect longer-term yields to keep shooting up and a normalization of the yield curve.

This has set up a brutal environment for utility stocks, which are typically desired by investors who are seeking dividend income. In a market in which you can receive a yield of 5.5% with little risk over the short term, and in which you can lock in a long-term yield of about 5%, why take a risk in the stock market? And if you believe that the core inflation rate of 3.7% makes a 5% yield seem paltry, keep in mind that not all investors think the same way. Many worry less about the inflation rate because large components of official inflation calculations, such as home prices and car prices, don’t affect everyone every year.

We cannot know when this current selloff of longer-term bonds will end, or how much of an effect it will have on the stock market. But sharp declines in the stock market can set up attractive price points for investors looking to go in for the long haul.

Screening for lower valuations and high ratings

A combination of rising earnings estimates and price declines could shed light on potential buying opportunities, based on forward price-to-earnings ratios.

Let’s look at the sectors again, in the same order, this time to show their forward P/E ratios, based on weighted rolling 12-month consensus estimates for earnings per share among analysts polled by FactSet:

Sector or index	Current P/E to 5-year average	Current P/E to 10-year average	Current P/E to 15-year average	Forward P/E	5-year average P/E	10-year average P/E	15-year average P/E
Utilities	82%	86%	95%	14.99	18.30	17.40	15.82
Real Estate	76%	80%	81%	15.19	19.86	18.89	18.72
Consumer Staples	93%	96%	105%	18.61	19.92	19.30	17.64
Healthcare	103%	104%	115%	16.99	16.46	16.34	14.72
Financials	88%	92%	97%	12.90	14.65	14.08	13.26
Materials	100%	103%	111%	16.91	16.98	16.42	15.27
Industrials	88%	96%	105%	17.38	19.84	18.16	16.56
Energy	106%	63%	73%	11.78	11.17	18.80	16.23
Consumer Discretionary	79%	95%	109%	24.09	30.41	25.39	22.10
Information Technology	109%	130%	146%	24.20	22.17	18.55	16.54
Communication Services	86%	86%	94%	16.41	19.09	19.00	17.43

S&P 500	94%	101%	112%	17.94	19.01	17.76	16.04
DJ Industrial Average	93%	98%	107%	16.25	17.49	16.54	15.17
Nasdaq Composite Index	92%	102%	102%	24.62	26.71	24.18	24.18
Nasdaq-100 Index	97%	110%	126%	24.40	25.23	22.14	19.43

There is a limit to how many columns we can show in the table. The S&P 500’s forward P/E ratio is now 17.94, compared with 16.79 at the end of 2022 and 21.53 at the end of 2021. The benchmark index’s P/E is above its 10- and 15-year average levels but below the five-year average.

If we compare the current sector P/E numbers to 5-, 10- and 15-year averages, we can see that the current levels are below all three averages for four sectors: utilities, real estate, financials and communications services. The first three face obvious difficulties as they adjust to the rising-rate environment, while the real-estate sector reels from continuing low usage rates for office buildings, from the change in behavior brought about by the COVID-19 pandemic.

Your own opinions, along with the pricing for some sectors, might drive some investment choices.

A broader screen of the S&P 500 might point to companies for you to research further.

We narrowed the S&P 500 as follows:

Current forward P/E below 5-, 10- and 15-year average valuations. For stocks with negative earnings-per-share estimates for the next 12 months, there is no forward P/E ratio so they were excluded. For stocks listed for less than 15 years, we required at least a 5-year average P/E for comparison. This brought the list down to 138 companies.
“Buy” or equivalent ratings from at least two-thirds of analysts: 41 companies.

Here are the 20 companies that passed the screen, for which analysts’ price targets imply the highest upside potential over the next 12 months.

There is too much data for one table, so first we will show the P/E information:

Company	Ticker	Current P/E to 5-year average	Current P/E to 10-year average	Current P/E to 15-year average
SolarEdge Technologies Inc.	SEDG	89%	N/A	N/A
AES Corp.	AES	66%	75%	90%
Insulet Corp.	PODD	18%	N/A	N/A
United Airlines Holdings Inc.	UAL	42%	50%	N/A
Alaska Air Group Inc.	ALK	51%	57%	N/A
Tapestry Inc.	TPR	39%	49%	70%
Albemarle Corp.	ALB	39%	50%	73%
Delta Air Lines Inc.	DAL	60%	63%	21%
Alexandria Real Estate Equities Inc.	ARE	59%	68%	N/A
Las Vegas Sands Corp.	LVS	96%	78%	53%
Paycom Software Inc.	PAYC	61%	N/A	N/A
PayPal Holdings Inc.	PYPL	33%	N/A	N/A
SBA Communications Corp. Class A	SBAC	27%	N/A	N/A
Advanced Micro Devices Inc.	AMD	58%	39%	N/A
LKQ Corp.	LKQ	92%	44%	78%
Charles Schwab Corp.	SCHW	75%	54%	73%
PulteGroup Inc.	PHM	94%	47%	N/A
Lamb Weston Holdings Inc.	LW	71%	N/A	N/A
News Corp Class A	NWSA	93%	73%	N/A
CVS Health Corp.	CVS	75%	61%	67%
Source: FactSet

Click on the tickers for more about each company or index.

Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.

News Corp
NWSA
is on the list. The company owns Dow Jones, which in turn owns MarketWatch.

Here’s the list again, with ratings and consensus price-target information:

Company	Ticker	Share “buy” ratings	Oct. 2 price	Consensus price target	Implied 12-month upside potential
SolarEdge Technologies Inc.	SEDG	74%	$122.56	$268.77	119%
AES Corp.	AES	79%	$14.16	$25.60	81%
Insulet Corp.	PODD	68%	$165.04	$279.00	69%
United Airlines Holdings Inc.	UAL	71%	$41.62	$69.52	67%
Alaska Air Group Inc.	ALK	87%	$36.83	$61.31	66%
Tapestry Inc.	TPR	75%	$28.58	$46.21	62%
Albemarle Corp.	ALB	81%	$162.41	$259.95	60%
Delta Air Lines Inc.	DAL	95%	$36.45	$58.11	59%
Alexandria Real Estate Equities Inc.	ARE	100%	$98.18	$149.45	52%
Las Vegas Sands Corp.	LVS	72%	$45.70	$68.15	49%
Paycom Software Inc.	PAYC	77%	$260.04	$384.89	48%
PayPal Holdings Inc.	PYPL	69%	$58.56	$86.38	48%
SBA Communications Corp. Class A	SBAC	68%	$198.24	$276.69	40%
Advanced Micro Devices Inc.	AMD	74%	$103.27	$143.07	39%
LKQ Corp.	LKQ	82%	$49.13	$67.13	37%
Charles Schwab Corp.	SCHW	77%	$53.55	$72.67	36%
PulteGroup Inc.	PHM	81%	$73.22	$98.60	35%
Lamb Weston Holdings Inc.	LW	100%	$92.23	$123.50	34%
News Corp Class A	NWSA	78%	$20.00	$26.42	32%
CVS Health Corp.	CVS	77%	$69.69	$90.88	30%
Source: FactSet

A year may actually be a short period for a long-term investor, but 12-month price targets are the norm for analysts working for brokerage companies.

Don’t miss: This fund shows that industry expertise can help you make a lot of money in the stock market

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October 3, 2023

Delta CEO says carrier went ‘too far’ in SkyMiles changes, promises modifications after frequent flyer backlash

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Delta Air Lines Boeing 717-200 airplane as seen on the final approach landing at New York JFK John F. Kennedy International Airport, NYC, USA.

NurPhoto / Contributor

Delta Air Lines CEO Ed Bastian said the airline will make “modifications” in the next few weeks to its loyalty program after a recently announced overhaul that would make it more expensive for many travelers to earn elite status and get into airport lounges was met with a backlash from customers.

“No question we probably went too far,” Bastian said at the Rotary Club of Atlanta on Monday.

The program changes, which Delta unveiled earlier this month, would reward customers with elite status based on how much they spent, a model similar to that of American Airlines, and reduce access to Delta popular airport Sky Club lounges for many American Express cardholders.

JetBlue Airways tried to capitalize on some customers’ anger over Delta’s changes by offering frequent flyer status matching, saying, “we’ve made it easy for you to cozy up to a new loyalty program and see where it goes.”

Delta has been grappling with a surge in elite travelers, bolstered by Covid pandemic and post-pandemic spending, and swarms of travelers trying to get into its lounges, leading to long lines for many customers. The airline and rivals including American and United have been racing to build bigger airport lounges to cater to swelling numbers of big spenders.

Bastian said the airline will announce the updated program changes in the coming weeks. A Delta spokesman declined to comment further on the changes.

“It’s gotten to the point, honestly, where we have so much demand for our premium product and services that are far in excess of our ability to serve it effectively in terms of our assets,” Bastian said.

He said that over Covid, the airline has doubled the number of Diamond Medallion status members.

David Neeleman, CEO of Breeze Airways and founder of JetBlue, told CNBC on Wednesday that he has Delta Medallion status and that he tries to use Delta’s airport lounges but that sometimes “there’s a big line and it’s not worth it.”

Delta last year announced several changes to crack down on overcrowding at the clubs, such as barring employees from using them when flying standby with company travel privileges, even if they had qualifying credit cards. The Atlanta-based carrier also raised prices for club memberships for regular customers.

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September 28, 2023

Delta will make it harder to get into airport lounges, changes rules to earn elite status

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Delta’s new SkyClub at John F. Kennedy International Airport in New York.

Leslie Josephs/CNBC

Delta Air Lines is changing how customers can earn elite frequent flyer status and is making it harder for many American Express cardholders to get into the carrier’s airport lounges, the latest reality check for air travel’s era of mass luxury.

Starting Jan. 1, customers will earn Delta Medallion status solely based on their spending, instead of a combination of dollars spent with the carrier and flights. The new model is similar to one that American Airlines adopted earlier this year.

Major airlines have continually raised the requirements to earn status as customer spending at the airline and on co-branded credit cards has surged in recent years, swelling the ranks of these high-paying customers. Elite status can come with a variety of perks, from early boarding to upgrades to first class and lounge access.

“We want customers to be able to receive status with activity beyond just air travel,” Dwight James, Delta’s senior vice president of customer engagement and loyalty, told CNBC.

Next year, Delta customers will earn 1 Medallion Qualifying Dollar for every $1 they spend on Delta flights, car rentals, hotels and vacation packages booked through the airline.

The ratio isn’t 1:1 for dollars spent through co-branded American Express cards. Delta SkyMiles Reserve and Reserve Business American Express card members earn 1 Medallion Qualifying Dollar for every $10 spent on the card, while Delta SkyMiles Platinum and Platinum Business American Express Card Members earn 1 Medallion Qualifying Dollar for every $20 spent.

Here are the new status requirements:

Silver Medallion – 6,000 MQDs
Gold Medallion – 12,000 MQDs
Platinum Medallion – 18,000 MQDs
Diamond Medallion – 35,000 MQDs

Raising the bar on Sky Club entry

Delta is limiting access to its popular Sky Club airport lounges through certain American Express credit cards after grappling with overcrowding at some of them, drawing complaints from travelers.

Instead of the current unlimited visits, starting Feb. 1, 2025, American Express Platinum and Platinum Business cardholders will get six visits a year, unless they spend $75,000 on the card in a calendar year.

Meanwhile, Delta SkyMiles Reserve and Reserve Business cardholders will get 10 Sky Club visits a year, a limit they can skirt by also spending $75,000 in a year.

Delta’s SkyMiles Platinum and Platinum Business American Express cards will no longer get club access through the cards itself, although customers can enter by buying a club membership or if they have elite status with Delta that allows them to pick a club membership as a perk.

“Some of the changes that we’re making ensures that we’re taking care of our most premium customers with our most premium assets, one of those being the Sky Club,” James said. He said the changes were made in conjunction with American Express.

The airline last year announced several changes to crack down on overcrowding at the clubs, including barring employees from using them when flying standby with company travel privileges, even if they had qualifying credit cards. It also raised prices for club memberships for regular customers.

Delta and its competitors are racing to build bigger and more modern lounges to accommodate customers. United Airlines, for example, on Wednesday opened a 35,000 square-foot club at its hub at Denver International Airport, the largest in its network, after opening a 24,000 square-foot club at the airport earlier this summer.

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September 13, 2023

American Airlines pilots approve sweetened labor deal with big raises

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An American Airlines plane takes off from the Miami International Airport on May 02, 2023 in Miami, Florida.

Joe Raedle | Getty Images

American Airlines pilots approved a sweetened labor deal, making the carrier the second major U.S. airline to seal a new contract with its highest-paid work group.

The more than 15,000 pilots at American will get immediate raises of 21% with compensation rising more than 46% over the duration of the contract, their union said Monday.

Delta Air Lines pilots ratified a new agreement earlier this year.

This is breaking news. Check back for updates.

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August 21, 2023

United reaches preliminary, 4-year labor deal with pilots, with up to 40% raises

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Pilots from United Airlines walk inside the airport as they take part in an informational picket at Newark Liberty International Airport in Newark, New Jersey, May 12, 2023.

Eduardo Munoz | Reuters

United Airlines and its pilots’ union have agreed to a preliminary labor deal that includes pay increases of as much as 40.2% over four years, ending months of tense negotiations and airport pickets. The deal makes United’s aviators the latest from a major airline to reach an agreement for higher wages amid the post-pandemic travel boom.

The preliminary deal, which the Air Line Pilots Association (ALPA) announced Saturday, comes months after Delta Air Lines pilots ratified a new contract that included 34% raises over four years, the first of the top four airlines to reach a new agreement. American Airlines and its pilots’ union reached a new labor deal with 40% raises over four years, though it still faces a ratification vote by members.

The pandemic paused contract negotiations across the industry but workers have been pushing for higher pay and better working conditions since travel demand returned and talks resumed.

ALPA said the tentative deal is worth about $10 billion. It includes a host of other improvements including overtime pay, holiday pay and scheduling. Cumulative pay increases range from 34.5% to 40.2% based on the type of aircraft a pilot flies.

The agreement in principle won’t be finalized until it’s ratified by the company’s 16,000 pilots.

“We promised our world-class pilots the industry-leading contract they deserve, and we’re pleased to have reached an agreement with ALPA on it,” United CEO Scott Kirby said in a LinkedIn post. “The four-year agreement, once ratified, will deliver a meaningful pay raise and quality of life improvements for our pilots while putting the airline on track to achieve the incredible potential of our United Next strategy.”

The pilots overwhelmingly rejected a preliminary, 18-month deal last year.

United is scheduled to report second-quarter earnings after the market closes Wednesday, and executives are likely to face questions about the cost of the deal during a conference call the next day.

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July 15, 2023

These companies reporting next week have a history of beating earnings estimates

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July 14, 2023

United gives 30,000 frequent flyer miles to travelers hit by flight delays, CEO says schedule cuts needed

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Planes are seen on the tarmac as people wait for their flight reschedule inside of the Newark International Airport on June 27, 2023 in Newark, New Jersey.

Kena Betancur | Getty Images News | Getty Images

United Airlines‘ CEO Scott Kirby said that without more gates the airline will have to reduce or change schedules to handle frequent gridlock at its Newark, New Jersey, hub, a message that came after mass flight delays marred July Fourth holiday weekend travel. The carrier gave 30,000 frequent flyer miles to customers who were most affected by the chaos.

“This has been one of the most operationally challenging weeks I’ve experienced in my entire career,” Kirby said in a note to staff on Saturday.

He said that the airline needs more gates at Newark Liberty International Airport because of frequent aircraft backups there. “We are going to have to further change/reduce our schedule to give ourselves even more spare gates and buffer — especially during thunderstorm season,” he added. United didn’t provide more detail on the schedule reductions.

A day earlier, Kirby apologized for taking a private jet out of New Jersey’s Teterboro Airport while thousands of passengers were stranded, CNBC first reported Friday.

Problems began with a series of thunderstorms in some of the country’s most congested airspace along the East Coast last weekend, cutting off routes for aircraft. While most airlines recovered, United’s problems continued during the week, angering both customers and crews. United and JetBlue Airways executives said air traffic control problems worsened the disruptions.

Kirby laid out the weeklong troubles and said long-term changes were needed. He said that extensively delayed departures, which piled up at its hub at Newark since last weekend, hurt its operation. Takeoffs were delayed by as much as 75% for longer than 8 hours in some cases from Sunday through Tuesday.

“Airlines, including United, simply aren’t designed to have their largest hub have its capacity severely limited for four straight days and still operate successfully,” he wrote.

Aircraft and crews were then left out of position, something that happens often during severe weather and can spark a cascade of disruptions for customers.

Unions complained about hours-long waits for crew members to get assignments and get hotels, forcing them to stay at airports longer.

Kirby said the carrier must improve the platforms so crews can get assignments and accommodation more easily on its app, saying what happened over the past week isn’t acceptable.

Kirby called for more investment in the FAA and air traffic control to avoid delays and staffing shortages, some of which occurred after hiring and training paused early in the pandemic.

United sent the 30,000 miles to customers who were delayed overnight or didn’t get to their destination at all, a spokeswoman said. She declined to say how many customers received the email.

More than 42,000 U.S. flights arrived late from last Saturday through Friday and more than 7,900 were canceled — or more than 5% of airlines’ schedules — a rate that was more than triple the average so far this year, according to flight-tracker FlightAware. United fared worse than competitors with about half of its mainline schedule arriving late and almost a fifth canceled over that period, FlightAware data show.

United’s operation improved on Saturday but disruptions lingered. About a third of its mainline schedule, or close to 864 flights were delayed and 60 flights, or 2% were canceled, down from 1,327 delays and 252 cancellations on Friday.

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July 1, 2023

Severe weather, FAA shortfalls kick off rocky start to summer air travel

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Passengers wait at the Newark Liberty International Airport as more than 2000 flights were canceled due to the nationwide storm in New Jersey, United States on June 27, 2023.

Fatih Aktas | Anadolu Agency | Getty Images

Flight disruptions mounted Tuesday as severe storms and staffing issues kicked off a rocky start to summer.

Roughly 3,000 U.S. flights were delayed as of midday Tuesday and another 1,100 were canceled as thunderstorms that derailed thousands of trips over the weekend lingered. That’s on top of more than 8,800 U.S. delays and 2,246 cancellations on Monday.

The disruptions come ahead of the busy Fourth of July travel period, when millions are expected to fly. The Transportation Security Administration said it could screen more travelers than in 2019, before the pandemic, raising competition for spare seats.

The Biden administration has pressured airlines to improve their operations after widespread flight disruptions last spring and summer, which prompted carriers to trim their overambitious schedules. But the industry struggled to recover this past weekend from a series of thunderstorms that didn’t let up for days.

Thunderstorms are difficult for airlines because they can form with less warning than other major weather obstacles like winter storms or hurricanes. Rolling delays could force crews to reach federally mandated workday limits and further worsen disruptions.

Some airline executives have also blamed some of the disruptions on shortages of air traffic controllers.

United Airlines CEO Scott Kirby told staff on Monday that “the FAA frankly failed us this weekend.” He said that during Saturday’s storms the FAA reduced arrival rates by 40% and departures by 75% at Newark Liberty International Airport, one of the airline’s biggest hubs.

“It led to massive delays, cancellations, diversions, as well as crews and aircraft out of position,” Kirby wrote in a staff note, which was seen by CNBC. “And that put everyone behind the eight ball when weather actually did hit on Sunday and was further compounded by FAA staffing shortages Sunday evening.”

An FAA spokesman said in a statement: “We will always collaborate with anyone seriously willing to join us to solve a problem.”

The staffing challenges aren’t new. The Covid-19 pandemic derailed hiring and training of new air traffic controllers, and the agency is now trying to catch up.

The Department of Transportation’s Office of the Inspector General said in a report last week that air traffic control staffing shortfalls puts air traffic operations at risk. In March, the FAA and some airlines agreed to reduce flights to help ease congestion at busy New York airports because of the staffing issues.

But the problems persist at a time when airlines are readying crews and schedules for a busy summer season, fueled by sustained travel demand.

And the disruptions frustrated flight crews who were left waiting on hold for reassignments.

The Association of Flight Attendants-CWA, which represents flight attendants at United and others said in a memo to members on Monday that hold times for crew scheduling were longer than three hours.

“There is an absolute recognition by Union leadership and Inflight management that something must be done in order to permanently address these adverse situations resulting from irregular operations,” the union said.

New York-based JetBlue Airways also faced high levels of flight delays over the past few days and acknowledged it can improve how it handles disruptions in a note to crew members Monday, which was reviewed by CNBC.

Don Uselmann, vice president of inflight experience at JetBlue, said the airline could have updated crew reporting times more efficiently so staff wouldn’t be waiting for flights and reducing wait times for hotel assignments.

“Summer peak is officially underway, and extreme weather events, ATC staffing constraints, and the resulting delays will put all airlines to the test,” he said in his note. “This weekend’s [irregular operation] won’t be our last, but the combination of events put acute pressure on the operation and made it more challenging than most.”

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June 27, 2023

Justice Department wins lawsuit to undo JetBlue, American Airlines partnership in the Northeast

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An American Airlines plane takes off near a parked JetBlue plane at the Fort Lauderdale-Hollywood International Airport on July 16, 2020 in Fort Lauderdale, Florida.

Joe Raedle | Getty Images

A federal judge Friday ordered American Airlines and JetBlue Airways to end their partnership in the Northeast, a win for the Justice Department after it sued to undo the alliance arguing it was anti-competitive.

The lawsuit, filed in September 2021, alleged that the airlines’ alliance was effectively a merger that would hurt consumers by driving up fares. The trial began a year later in Boston and wrapped up in December.

Both airlines expressed disappointment with the decision and said they were considering next steps.

“It makes the two airlines partners, each having a substantial interest in the success of their joint and individual efforts, instead of vigorous, arms-length rivals regularly challenging each other in the marketplace of competition,” U.S. District Judge Leo Sorokin said in his ruling.

Fort Worth, Texas-based American Airlines and New York-based JetBlue Airways argued they needed the so-called Northeast Alliance to better compete with other large carriers Delta Air Lines and United Airlines in congested airports in the region.

“Whatever the benefits to American and JetBlue of becoming more powerful — in the northeast generally or in their shared rivalry with Delta — such benefits arise from a naked agreement not to compete with one another,” Sorokin wrote. “Such a pact is just the sort of ‘unreasonable restraint on trade’ the Sherman Act was designed to prevent.”

He ordered the airlines to end the partnership 30 days after the ruling. The carriers are likely to challenge the decision. A JetBlue spokeswoman said the carrier is studying the decision and evaluating next steps.

“We are disappointed in the decision,” the spokesperson said. “We made it clear at trial that the Northeast Alliance has been a huge win for customers. Through the NEA, JetBlue has been able to significantly grow in constrained northeast airports, bringing the airline’s low fares and great service to more routes than would have been possible otherwise.”

“The Court’s legal analysis is plainly incorrect and unprecedented for a joint venture like the Northeast Alliance,” an American Airlines spokesman said in a statement. “There was no evidence in the record of any consumer harm from the partnership, and there is no legal basis for inferring harm simply from the fact of collaboration.”

Undoing the partnership would be difficult, especially during the peak summer travel season, which airlines have already sold tickets for.

JetBlue and American are not allowed to coordinate fares under the partnership, which was approved in the final days of the Trump administration in 2021 and has since expanded.

JetBlue had previously warned in a securities filing a ruling against the NEA “could have an adverse impact on our business, financial condition, and results of operations.

“Additionally, we are incurring costs associated with implementing operational and marketing elements of the NEA, which would not be recoverable if we were required to unwind all or a portion of the NEA,” the company said.

The Justice Department didn’t immediately respond to a request for comment.

The department separately in March filed an antitrust lawsuit to block JetBlue’s proposed acquisition of budget carrier Spirit Airlines, arguing the deal would drive up fares, “harming cost-conscious fliers most acutely.”

That combination faces a high hurdle for approval by the Biden administration, which has vowed to take a hard line against what it views as anti-competitive deals.

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May 19, 2023

Treasury yields little changed as focus remains on economic outlook, earnings

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John Zich | Bloomberg | Getty Images

U.S. Treasury yields were little changed on Tuesday, as investors continued to assess the outlook for the U.S. economy and digested the latest round of corporate earnings.

As of around 2:20 a.m. ET, the yield on the benchmark 10-year Treasury note was fractionally higher at 3.5946% while the yield on the 30-year Treasury bond also nudged marginally upwards to 3.8080%. Yields move inversely to prices.

Corporate earnings season dominates this week’s agenda, with giants Johnson & Johnson, Bank of America and Goldman Sachs all set to report before the opening bell on Wall Street on Tuesday.

On the data front, traders will have an eye on the March housing starts and building permits figures due at 8:30 a.m. ET. Housing starts for the month are expected to have fallen by 3.4% to 1.40 million units, according to Dow Jones consensus estimates, while building permits are projected to drop by 4.9% to 1.45 million units.

Markets are closely following economic data for a read on where the Federal Reserve might take interest rates at its next meeting in early May. More than 84% of traders are calling a 25 basis point hike at the next policy meeting, according to CME Group’s FedWatch tool.

An auction will be held Tuesday for $34 billion of 52-week Treasury bills.

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April 17, 2023

American Airlines stock dives after profit outlook raised, but disappoints Wall Street

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Shares of American Airlines Group Inc. were rocked Wednesday, after the air carrier raised its profit outlook, but not by enough to match Wall Street expectations.

The company said before the open that it expects first-quarter adjusted earnings per share of 1 cent to 5 cents, compared with a per-share loss of $2.32 a year ago. While that’s better than previous guidance for an “approximately breakeven” quarter, the average EPS estimate of analysts surveyed by FactSet was 5 cents.

The…

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April 12, 2023

United Airlines reaches tentative labor agreements with ground workers union

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An airline passenger checks in at the United airlines desk at the Tampa International Airport in Tampa, Florida, January 19, 2022.

Octavio Jones | Reuters

United Airlines has reached tentative agreements with a union representing nearly 30,000 ground workers, the labor group said Wednesday.

The International Association of Machinists and Aerospace Workers said the two-year tentative agreements cover “industry-best” wage rates, as well as job protection and certain guards against outsourcing roles. The specific terms of the contacts were not disclosed.

The deal comes while United is in talks with labor unions representing its pilots and flight attendants. Pilots last year rejected a preliminary agreement, and negotiations have since resumed.

Members of IAM District 141 will receive more details about the tentative agreements, the union said in a statement. The union will soon announce a schedule for a ratification vote.

“Job security and industry-leading wages are rightfully two top priorities for our membership at United Airlines,” said IAM Air Transport Territory Airline Coordinator Tom Regan.

In a statement, IAM District 141 said that if the agreements are ratified by members, the union “will be back in negotiations one year from the date these agreements are ratified to bargain for more.”

The two-year tentative agreements cover seven work classifications: fleet service workers, passenger service workers, storekeepers, central load planners, maintenance instructors, fleet technical instructors and security officers.

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March 29, 2023

Biden taps CEOs of 3M, CVS, FedEx, Citi, others to join his Export Council on trade

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US President Joe Biden meets with CEOs about the economy in the South Court Auditorium of the Eisenhower Executive Office Building, next to the White House, in Washington, DC on July 28, 2022.

Mandel Ngan | AFP | Getty Images

U.S. President Joe Biden has appointed the heads of Citigroup, United Airlines, CVS, 3M and FedEx, among other top executives, to sit on a White House advisory committee overseeing international trade.

The President’s Export Council gives recommendations and insight into the ways government policies impact U.S. trade performance. The group also provides feedback on how Biden’s trade policies are affecting businesses across sectors from industry and labor to agriculture.

D.C. businessman Mark D. Ein will chair the board. He currently serves as chairman of Lindblad Expeditions and Kastle Systems and is on the board of directors of Custom Truck One Source and Membership Collective Group. Walgreens Boots Alliance CEO Rosalind Brewer will serve at the council’s vice chair. She previously served as chief operating officer and group president of Starbucks and CEO of Sam’s Club.

The 25-member board includes: Dana Walden, co-chairman of Disney Entertainment; Jane Fraser, Citigroup CEO; Michael F. Roman, chairman and CEO of 3M; Rajesh Subramaniam, president and CEO of FedEx; Karen S. Lynch, president and CEO of CVS; John Lawler, chief financial officer of Ford; Gareth Joyce, CEO at Proterra; Brett Hart, president of United Airlines; Beth Ford, president and CEO of Land O’Lakes; and Qualcomm CEO Cristiano R. Amon.

The Export Council features expertise from labor, real estate, national security and law, and leaders of Fortune 200 companies. Biden has previously reached out to some of the executives for counsel on the state of the economy.

Other members include: Raymond E. Curry Jr., president of the UAW union; Rich Lesser, global chair of Boston Consulting Group; Patrick E. Murphy, a former congressman who is the chief investment officer of Coastal Construction Group; Robert G. Martinez Jr., international president of the International Association of Machinist and Aerospace Workers union; Daniel Rosen, CEO of real estate firm Rosen Partners; and Brett Isaac, co-founder and executive chairman of Navajo Power.

Other members of the council include:

Lisa Disbrow, a national security expert who served as the undersecretary of the Air Force;
Lacy M. Johnson, partner-in-charge of Taft’s D.C. law firm;
Juan Verde, strategist and consultant with stops at Santander Bank Investments and the World Bank;
Michelle W. Singer, senior vice president for political engagement at Comcast;
Farnam Jahanian, president of Carnegie Mellon University;
Paul A. Laudicina, chairman emeritus of the consulting firm A.T. Kearney; and
Deloitte Global CEO Emeritus Punit Renjen.

Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.

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February 28, 2023

United Airlines swings to profit despite ‘worst’ winter storm, issues blue-sky guidance

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United Airlines Holdings Inc. late Tuesday reported fourth-quarter earnings that were well above Wall Street expectations, saying it managed well the severe winter-weather disruptions in late December, and offered an optimistic view of the current quarter and guidance for full-year 2023.

United
UAL,
-0.87%
managed through “one of the worst weather events in my career to get deliver for so many of our customers and get them home for the holidays,” United Airlines Chief Executive Scott Kirby said.

U.S. airlines canceled or delayed thousands of flights in late December due to Winter Storm Elliott, with Southwest Airlines Co.
LUV,
+0.14%
the worst affected. Southwest told Wall Street to expect a fourth-quarter loss, adding that the cancelations are likely to cost about $825 million.

United’s Kirby pinned the different outcome for his airline on “critical” investments in personnel and technology. “That’s why we’ve got a big head start, and we’re now poised to accelerate in 2023,” the CEO said.

United earned $843 million, or $2.55 a share, in the fourth quarter, swinging from a loss of $646 million, or $1.99 a share, in the year-ago quarter. Adjusted for one-time items, United earned $2.46 a share.

Revenue rose to $12.40 billion from $8.2 billion a year ago.

Analysts polled by FactSet expected United to report adjusted earnings of $2.11 a share on revenue of $12.23 billion.

The stock rallied more than 3% in extended trading after ending the regular trading day down 0.9%. The airline has scheduled a conference call with analysts Wednesday at 10:30 a.m. Eastern

United guided for first-quarter adjusted EPS between 50 cents and $1, well above current FactSet consensus of 31 cents a share, and said it expects revenue to grow around 50% in the quarter.

For the full year, the airline called for adjusted EPS between $10 and $12, also significantly higher than FactSet consensus of $6.84 a share.

United stock has gained 9% in the past 12 months. That contrasts with losses of around 14% for the S&P 500 index
SPX,
-0.20%
and of nearly 10% for the U.S. Global Jets ETF
JETS,
+0.40%.

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January 17, 2023

FAA orders airlines to pause departures after system outage

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Shannon Stapleton | Reuters

Hundreds of U.S. flights were delayed Wednesday morning after the Federal Aviation Administration suffered an outage of the system that sends messages to pilots.

The FAA said on its website that domestic departures would be paused until 9:30 a.m. ET. The agency said it was working to restore the Notice to Air Missions System.

The White House said Transportation Secretary Pete Buttigieg had briefed President Joe Biden on the outage. “There is no evidence of a cyberattack at this point, but the President directed DOT to conduct a full investigation into the causes,” White House press secretary Karine Jean-Pierre said in a tweet.

More than 1,200 U.S. flights were delayed on Wednesday by 7:25 a.m. ET, according to FlightAware.

“This technology issue is causing significant operational delays across the National Airspace System,” said Airlines for America, an industry group that represents major U.S. carriers, including Delta, American, United, Southwest and others.

Austin-Bergstrom International Airport in Texas said in a tweet that arriving and departing passengers should expect delays throughout the day.

This is breaking news. Please check back for updates.

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January 11, 2023

Airline stocks fell premarket after FAA says all U.S. flights grounded over computer outage

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Airlines stocks fell across the board in premarket trade Wednesday, after the Federal Aviation Administration said a computer outage had led to all U.S. fights being grounded. The agency said on its website that its “Notice to Air Missions” system has been activated “to address the equipment outage issues for the U.S. NOTAM system.” A NOTAM is a notice for workers engaged in flight operations. There was no indication of when service might be restored. Southwest Airlines Co.
LUV,
+1.68%
led the decliners, falling 2.5%. American Airlines Group Inc.
AAL,
+3.97%
was down 1.6%, United Airlines Holdings Inc.
UAL,
+5.54%
was down 0.8%, JetBlue Airways Corp.
JBLU,
+4.92%
was down 0.7% and Delta Air Lines Inc.
DAL,
+3.59%
was down 0.7%. The U.S. Global Jets ETF
JETS,
+2.40%
was down 0.7% and has fallen 14% in the last 12 months, while the S&P 500
SPX,
+0.70%
has fallen 17%.

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January 11, 2023

Southwest cancels 60% of flights while air travel disruptions ease elsewhere

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Aircraft are deiced at General Mitchell International Airport in Milwaukee

Reuters

Flight cancellations eased further on Monday but disruptions from severe winter weather across the U.S. lingered, particularly for Southwest Airlines, at the tail end of Christmas weekend.

Airlines have canceled more than 17,000 U.S. flights since Wednesday, according to FlightAware, as storms brought snow, ice, high winds and bitter cold around the country, derailing air travel from coast to coast. Those conditions slowed down ground crews as they faced severe conditions at airports.

Carriers are likely to detail the costs of the disruptions when they report results next month, if not earlier.

Southwest Airlines was hit particularly hard by winter weather over the holiday travel period, along with other issues including unexpected fog in San Diego and staffing shortages at a fuel vendor in Denver, the carrier’s chief operating officer told staff.

Delta Air Lines, American Airlines, United Airlines, JetBlue Airways and Alaska Airlines were among the carriers affected by the weather that hit last week but had a smaller share of cancellations on Monday.

Southwest had been canceling many flights proactively in an effort to stabilize its operation, COO Andrew Watterson said. From Wednesday through Saturday, about a quarter of Southwest’s flights were canceled, and two-thirds were delayed, according to FlightAware data.

The airline apologized to employees for the chaos, which left many struggling to get a hold of crew scheduling services, making it harder to get reassignments or make other changes, or get hotel rooms. Southwest also offered flight attendants working over the holiday extra pay.

“Part of what we’re suffering is a lack of tools,” Southwest CEO Bob Jordan said in a message to staff on Sunday. “We’ve talked an awful lot about modernizing the operation, and the need to do that. And Crew Scheduling is one of the places that we need to invest in. We need to be able to produce solutions faster.”

Some pilots were forced to sleep at airports because they were unable to find hotel rooms, said Casey Murray, president of Southwest Airlines Pilots Association, the pilots’ union.

Southwest’s problems continued on Monday while other carriers stabilized. The carrier had canceled more than 2,300 flights, 58% of its schedule, and 820 more were delayed. Delta had canceled 8% of its mainline flights on Monday, United 5% and American less than 1% with 12 flights scrubbed.

More than 3,200 U.S. flights were canceled on Monday, and close to 5,000 were delayed.

Airlines often cancel flights proactively during bad weather to avoid having planes, crews and customers out of place, problems that can make recovery from a storm more difficult.

Carriers also planned smaller schedules for Christmas Eve and Christmas Day compared with the days leading up to the holidays, making it harder for them to rebook travelers on other flights, and bookings had spiked.

Passengers check in at the Delta counter at Detroit Metro Airport in Romulus, Michigan, on December 22, 2022.

Jeff Kowalsky | AFP | Getty Images

An American Airlines spokeswoman said the “vast majority of our customers affected by cancellations were able to be reaccommodated.”

Delta is “seeing steady recovery in our operations, and expect the improvements to continue over the next several hours,” a spokesman said Monday.

Passengers also faced delayed luggage, however.

Bill Weaver, 41, said he, his wife and five children drove from Wichita, Kansas to Dallas Fort Worth International Airport for a Friday flight to Cancun after their connecting flight into the American Airlines hub was canceled. The American Airlines flight to Cancun arrived on time but their luggage didn’t get to in Cancun until Monday, and hadn’t made it to their hotel by mid-morning, so they had to spend hundreds of dollars to buy clothing and other essentials at their hotel.

Weaver, who works in software sales, said he used to travel frequently.

“I’m used to missing bags and things happen but this is by far the worst I’ve ever seen,” he said.

Extreme cold and high winds slowed ground operations at dozens of airports. More than half of U.S.-based airlines’ flights arrived late from Thursday through Saturday, with delays averaging 81 minutes, according to FlightAware.

“Temperatures have fallen so low that our equipment and infrastructure have been impacted, from frozen lav systems and fuel hoses to broken tow bars,” said United Airlines message to pilots on Saturday. “Pilots have encountered frozen locks when trying to re-enter the jet bridge after conducting walk arounds.”

The FAA said it had to evacuate its tower at United hub Newark Liberty International Airport in New Jersey because of a leak on Saturday.

JetBlue, meantime, offered flight attendants triple pay to pick up trips on Christmas Eve due to staffing shortages.

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December 26, 2022

American Airlines is dropping regional carrier Mesa, citing financial and operational problems

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American Eagle Bombardier CRJ-900ER aircraft seen at Phoenix Sky Harbor International Airport.

Alex Tai | SOPA | Getty Images

American Airlines said Saturday that it will drop Mesa Air for some of its regional flying, citing concerns about its partner’s financial and operational problems, issues that are tied to a rise in costs and the industry’s pilot shortage.

“As a result, we have concerns about Mesa’s ability to be a reliable partner for American going forward,” Derek Kerr, American’s chief financial officer and president of American’s regional brand American Eagle, said in a staff note, which was seen by CNBC on Saturday. “American and Mesa agree the best way to address these concerns is to wind down our agreement.”

related investing news

The final Mesa flight for American will be on April 3, though American is slashing Mesa flights in March, Kerr said in his note.

Now, Arizona-based Mesa is planning to transition “all of our CRJ900 flying to United Airlines,” a carrier it already flies for, Mesa’s CEO Jonathan Ornstein said in a note to staff on Saturday, which was seen by CNBC.

United declined to comment.

Large carriers like American, United and Delta Air Lines routinely contract regional airlines to fly many shorter routes, and they account for roughly half of departures, though that varies by airline.

The heart of the problem stems from a shortage of pilots, which is most acute at regional carriers, and has become more severe since travel demand snapped back after a pandemic travel slump. Mesa and other regional airlines have sharply raised wages to attract and retain aviators. American raised wages at its regional subsidiaries.

American declined to fund higher pilot rates for other regional partners, Mesa’s CEO told staff, adding that they were penalized for not being able to meet pre-Covid contract obligations.

“With that in mind, we are excited to announce we have negotiated a wind down of our operations with American and are finalizing a new agreement with United which would transition all CRJ900s currently flying for American Eagle to United Express,” Mesa’a Ornstein said.

American didn’t comment on the Mesa note to staff.

Mesa had a net loss of about $67 million in the nine months ended June 30, according to a securities filing. Last week, the airline postponed its quarterly earnings report.

As of Sept. 30, 2021, about 45% of Mesa’s revenue came from American and 52% from United, according to the company’s last annual filing, which was published a year ago. Mesa also flies for DHL.

American said its agreement with Mesa was mostly tied to its hubs at Dallas/Fort Worth International Airport and Phoenix Sky Harbor International Airport.

American plans to concentrate its flying with its wholly owned regional subsidiaries like Envoy and PSA, as well as an independent regional carrier SkyWest. Air Wisconsin will also fly for the American Eagle brand, starting its agreement earlier than originally planned, Kerr said.

“The flying previously done by Mesa will be backfilled by these high-quality regional carriers as well as our mainline operation, ensuring we can continue to build and deliver the very best global network for our customers,” Kerr wrote.

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December 17, 2022

Delta Air Lines stock jumps on raised guidance, as carrier cites ‘robust’ demand for air travel

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Delta Air Lines’ stock rose 4.7% before market open on Wednesday after the company raised its earnings guidance.

The carrier
DAL,
-4.00%
said it is executing on its three-year recovery plan, with year-one results ahead of expectations. Delta also highlighted robust demand for air travel as the industry recovers from the widespread disruption caused by the COVID-19 pandemic.

The carrier raised its 2022 adjusted EPS guidance to $3.07 to $3.12. Analysts surveyed by FactSet were looking for earnings of $2.88 a share. For 2023, Delta Air Lines Inc. forecast a near doubling of adjusted earnings to $5 to $6 a share.

See Now: After too little, too much, there are ‘Goldilocks’ conditions for air travel in 2023

Delta also forecast 2023 revenue growth at 15% to 20% compared with 2022 and said it is on track to meet its 2024 earnings target of more than $7 a share. “Demand for air travel remains robust as we exit the year and Delta’s momentum is building,” said Delta CEO Ed Bastian, in a statement.

Delta said it expects to deliver strong topline growth in 2023 and significant operating leverage, boosted by a full restoration of its network and continued improvements in premium and loyalty revenue.

Non-fuel unit costs are expected to decline 5% to 7%, driving Delta’s margin expansion and adjusted earnings growth, the company said. Delta expects to generate more than $2 billion of free cash flow, which it said will enable further debt reduction.

See Now: Delta kicked off airline earnings season with a bang. What does it mean for other carriers?

“2022 is proving to be a pivotal year as we rebuild the world’s best-performing airline,” said Bastian, in the statement.

The company’s robust guidance boosted other airline stocks before market open, with United Airlines Holdings Inc.
UAL,
-6.94%
rising 1.4%, American Airlines Group Inc.
AAL,
-5.21%
gaining 1.3%, and JetBlue Airways Corp.
JBLU,
-7.67%
rising 1.3%.

Delta shares have fallen 14.6% this year, compared with the S&P 500 index’s
SPX,
+0.73%
decline of 15.7% and the U.S Global Jets ETF’s
JETS,
-2.85%
slump of 14.3%.

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December 14, 2022

S&P 500, Nasdaq post worst day in month after strong data fuels worry about Fed rate hikes

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The S&P 500 and Nasdaq Composite indexes recorded their worst day in almost a month on Monday, after a hotter-than-expected U.S. services-sector reading fueled concerns that the Federal Reserve may need to be even more aggressive in its inflation battle.

How stocks traded

The Dow Jones Industrial Average
DJIA,
-0.26%
finished down 482.78 points, or 1.4%, at 33,947.10.
The S&P 500
SPX,
-1.79%
ended 72.86 points lower, or 1.8%, at 3,998.84.
The Nasdaq Composite
COMP,
-11.01%
closed down 221.56 points, or 1.9%, at 11,239.94.
Those were the largest declines for the S&P 500 and Nasdaq Composite since Nov. 9, according to Dow Jones Market Data.

Stocks finished mixed on Friday, although they clinched gains last week, following a robust November jobs report, which stoked fears that inflation might not be so easily defeated.

What drove markets

Strong wage growth numbers released Friday were followed up on Monday by a robust reading for the U.S. services sector — both of which helped to stoke fears that the Fed’s interest-rate hikes, along with the central bank’s modest balance-sheet unwind, haven’t had much of an impact on the tight labor market.

The ISM barometer of U.S. business conditions in the service sector came in stronger than expected, rising to 56.5% in November, a healthy showing that signals the U.S. economy is still expanding at a steady pace.

“If nothing else, the ISM services report is being interpreted as very strong, and thus the economy is overheating and that means more Fed tightening,” said Will Compernolle, a senior economist at FHN Financial in New York. “Consumer resilience has proven to be more intense than I would have expected. In the two most interest-rate sensitive sectors — housing and autos — tightening has channeled into markets in meaningful ways.”

But there has been so much pent-up demand, that higher interest rates haven’t been cooling overall spending as much as the Fed would like because companies are still having to fill a backlog of orders, he said via phone.

In other economic data, the final November S&P Global U.S. services PMI edged up to 46.2 from 46.1, but remained in contractionary territory.

November jobs data released on Friday showed average hourly wages grew over the past year by more than 5% as of November, beating economists’ expectations and stoking concerns that robust wage growth would continue to fuel inflation, market strategists said.

Worries about a more-aggressive Fed also helped to drive Treasury yields higher, adding to the pressure on stocks. The yield on the 10-year note rose 9.6 basis points to 3.6% on Monday. Treasury yields move inversely to prices, and yields had fallen sharply over the past month, driven by shifting expectations about the pace of Fed rate hikes.

Monday’s ISM services figure “surprised to the upside, suggesting that the economy is still running above its long-run sustainable path and that the Fed is going to have to slow the economy more than expected in 2023,” Bill Adams, the Dallas-based chief economist for Comerica Inc. CMA, said via phone.

In other markets news, signs that China’s government is easing its COVID restrictions helped Hong Kong’s Hang Seng Index
HSI,
+4.51%
finish with a 4.5% gain.

Meanwhile, oil futures ended lower on Monday, a day after Sunday’s decision by OPEC and its allies to keep production quotas unchanged.

Falling equity prices helped drive the CBOE Volatility Index
VIX,
+8.87%,
also known as the VIX, back above 20 on Monday. The volatility gauge had fallen sharply in recent weeks as stocks rallied, potentially signaling complacency that could ultimately hurt stocks, said Jonathan Krinsky, chief market technician at BTIG, in a note to clients.

Companies in focus

Tesla Inc.
TSLA,
-6.37%
shares finished 6.4% lower after reports of a looming production cut at its factory in Shanghai, though the electric-vehicle manufacturer denied the reports.
GameStop Corp.‘s Class A shares
GME,
-7.12%
ended down by 7.1% ahead of the company’s third-quarter results, which are set to be released after the market closes on Wednesday. Analysts are looking for a narrowing loss from the videogame retailer.
Shares of U.S. airlines and aircraft makers traded higher on Monday, bucking the broader trend in stocks. Boeing Co.
BA,
+1.22%
and United Airlines Holdings Inc.
UAL,
+2.60%
were among the best performers in the S&P 500, finishing up by 1.2% and 2.6%, respectively.
Shares of Salesforce, Inc.
CRM,
-7.35%
ended down by 7.4% after the company confirmed its CEO Stewart Butterfield is leaving the company following Bret Taylor, the co-CEO, who departs at the end of January.

––Jamie Chisholm contributed reporting to this article.

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December 5, 2022

Tag: United Airlines Holdings Inc

Screening for lower valuations and high ratings

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How stocks traded

What drove markets

Companies in focus