AMR Upgrade Gives Airlines a Boost
The airline sector took off Monday following an analyst's upgrade on shares of American Airlines parent AMR (AMR) and a dip in crude oil below $60 a barrel.
Citing capacity reductions that are likely to boost fares next year, Lehman Brothers analyst Gary Chase upped his rating on AMR to overweight from equal-weight. The analyst, whose firm does and seeks to do business with companies covered in its research reports, also said the fundamental outlook had improved for the entire sector.
In reaction, AMR shares jumped 59 cents, or 4.6%, to $13.47 on higher-than-normal volume of 5.2 million shares. Most other airline stocks followed in a broad rally that lifted the Amex Airline Index by 3.4%.
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