Trader Talk

Pisani: US Airlines Trading Up

US airlines are trading up 1 to 2 percent today. Airline earnings season begins this week with AMR (Jan. 20), Continental (Jan. 21), and Southwest (Jan. 21) all reporting this week.

Traders still getting over the shock of Japan Air Lines bankruptcy; JAL has been bailed out 4 times in past 10 yrs by the Japanese government, so cutting them loose is a big deal.It has debt of $25 billion and will be cutting 15,000 jobs and many unprofitable routes.

There may be implications for US airlines here: AMR is part of the Oneworld alliance with JAL, and Delta very much wants in on that. Both are vying to make deeper investments into JAL in an effort to get a deeper foothold into Asia.

Matt Jacob at Majestic Research noting that revenue trends have been improving, largely due to improving comps on some signs that business and corporate travel are picking up a bit.

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