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Fears of hurricane hit ease after Delta's forecast, airline stocks surge

Key Points
  • Delta is on track for the biggest one-day percentage gain since January 2015.
  • The airline warned investors Irma would cost it $120 million.
  • Other airlines rose along with Delta.
Andrew Harrer | Bloomberg | Getty Images

Shares of the largest U.S. airlines soared Tuesday, led by No. 2 U.S. carrier, Delta.

Delta shares rose close to 7%, their biggest one-day gain since January 2015.

The airline told investors earlier Tuesday that Hurricane Irma, which struck its Atlanta hub and important Florida airports, would cost it $120 million in the third quarter. The carrier canceled 2,200 flights in the southern U.S. and the Caribbean because of the storm.

Delta said including the impact from Hurricane Irma, its passenger unit revenue, which measures how much money the airline is making for each seat flown a mile, likely rose 2 percent in the three months ended in September.

Shares of other airlines also rallied. United and American each added around 6 percent, and JetBlue and Spirit both closed more than 7% percent higher. Southwest rose 4.5 percent.

Delta is scheduled to report third-quarter earnings in the middle of the month.

Despite the gains, airline stock performance has been mixed this year as carriers grapple with higher fuel prices and a fare war, pitting large international airlines against low-cost airlines.

Delta's stock surge on Tuesday pulled it back into positive territory for the year with a 4 percent gain.