Airline Sector Climbing Higher

NEW YORK ( TheStreet) -- The airline sector has made heavy advances in afternoon trading, on the heels of Morgan Stanley ( MS ) touting the sector's attractiveness.

The Amex Airline index has gone up by 3.5% to $29.50.

"Now that ... previously exuberant expectations have normalized as evidenced by price action in the last one to two months versus improving trends and ... the risk of a liquidity squeeze at a major carrier in 2010 has fallen; we believe investors will become increasingly willing to bet on the cycle," wrote Morgan Stanley analyst William J. Greene in a note to investors cited by the Wall Street Journal.

Greene has boosted his outlook for the sector to attractive from in-line.

On top of that, he also lifted his ratings on AMR ( AMR) and UAL ( UAUA) to overweight from equalweight and lowered his ratings on Alaska Air ( ALK) to underweight from equalweight.

UAL stock has soared 11.3% to $9.20. AMR has risen 6.8% to $6.70. Delta ( DAL) shares are also up, 7.2% to $9.20. Another big gainer is US Airways ( LCC), which has added 6.8% to $3.90. Continental Airlines ( CAL)stock has risen 4.8% to $15.70.

After a ratings cut from JP Morgan, shares of Alaska Air tumbled 2.1% to land at $30.30.

One of the largest anomalies in today's airline sector has been China Eastern Airlines ( CEA), which has taken a 6.6% fall to $37.80.

-- Reported by Andrea Tse in New York.

Follow TheStreet.com on Twitter and become a fan on Facebook.

Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

More from Stocks

Other Electric-Car Makers Can't Compete With Tesla's Battery Tech

Other Electric-Car Makers Can't Compete With Tesla's Battery Tech

3 Must Reads on the Market From TheStreet's Top Columnists

3 Must Reads on the Market From TheStreet's Top Columnists

Dow Tumbles as Trump Ratchets Up China Trade Fight

Dow Tumbles as Trump Ratchets Up China Trade Fight

10 Stocks Goldman Sachs Thinks Will Crush the S&P 500's Performance in 2019

10 Stocks Goldman Sachs Thinks Will Crush the S&P 500's Performance in 2019

Dropbox Is the New Defensive Stock to Own With the Market Falling Apart

Dropbox Is the New Defensive Stock to Own With the Market Falling Apart