Five-Day Forecast: Airlines Set to Lose Cabin Pressure

(Author's note: Richard Posluszny and Peter Garcia contributed substantially to this article.)

Next week should bring us a slew of economic data readings. Frankly, the key items appear unlikely to move the markets in either direction. For example, core reading on consumer (CPI) and producer (PPI) inflation, which are slated for release in the middle of the week, are expected to stay around 0.2%.

And few expect the data on housing starts, crude oil inventories and business inventories to stray from their recent quiescent readings. Instead, the market is likely to be affected by an expected onslaught of earnings reports.

Airlines in the Cross Hairs

It is well known that high oil prices have decimated the airline industry. Share prices have slumped sharply as profits have turned to losses. But things could worsen further, and bankruptcy for a major carrier or two is not out of the question. That could present a great opportunity for short-sellers.

In the coming week, we'll get earnings reports from Delta Airlines (DAL - commentary - Cramer's Take) and AMR (AMR - commentary - Cramer's Take), the parent company of American Airlines, on Wednesday, July 16. Continental Airlines (CAL - commentary - Cramer's Take) is set to weigh in the following day, while Northwest Airlines (NWA - commentary - Cramer's Take) is set to report earnings during the subsequent week.

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David Sterman has been an equity analyst and financial journalist for 15 years, most recently serving as Director of Research at Jesup & Lamont Securities.