Hotel Winners & Losers: Starwood

STR noted that the luxury hotel segment booked the steepest declines. Luxury occupancy tumbled 24.4% and average rates fell 14.5%, resulting in a 35.4% drop in luxury segment revpar. The luxury segment has been hit hardest by the economic downturn as businesses and consumers trade-down to less expensive properties.

STR noted that the week's results likely were skewed somewhat because Christmas fell on a Thursday in 2008, while it fell on a Tuesday in 2007.

Oppenheimer & Co. analyst David Katz noted that the timing of Hanukkah during the week also likely skewed the results. Hanukkah started during the previous week in 2007.

Scholes said the lackluster weekly results "suggest that more travelers stayed home and indulged in 'staycation' versus the same time last year."

"Overall, conditions clearly deteriorated in the back half of 2008, with (the fourth quarter) being a particularly weak quarter," said Katz.

Shares of Wyndham Worldwide(WYN Quote), Morgans Hotel Group(MHGC Quote) and Gaylord Entertainment(GET Quote) also surged on Friday afternoon.

Wyndham shares jumped $1.01, or 15.42, to $7.56. Morgans Hotel's stock gained 49 cents, or 10.5%, to $5.15. Gaylord's stock rose $1.37, or 12.64%, to $12.21.