Airline Stocks Slide as U.S. Shutdown Fears Spark Market Turbulence
Shares of major U.S. airlines fell sharply on Tuesday amid growing concerns about the ongoing government shutdown and its potential impact on air travel.
American Airlines (NASDAQ:AAL) dropped 2.75%, Delta Air Lines (NYSE:DAL) declined 2.9%, and United Airlines (NASDAQ:UAL) fell 2.5%, reflecting a broader wave of market weakness across the transportation sector.
The selloff intensified after U.S. Transportation Secretary Sean Duffy warned that the government shutdown could lead to “mass chaos” in air travel if it continues for another week. Duffy said the situation could result in widespread flight delays, cancellations, and even temporary airspace closures due to staffing shortages.
“If you bring us to a week from today, Democrats, you will see mass chaos, you will see mass flight delays, you’ll see mass cancellations, and you may see us close certain parts of the airspace because we just cannot manage it,” Duffy stated during a press conference on Tuesday.
The political impasse shows no signs of ending soon, with Democrats and Republicans continuing to blame each other for the budget stalemate. United Airlines has already warned investors that the shutdown could impact financial performance if travel disruptions escalate.
Industry analysts say airline stocks are particularly vulnerable, as the shutdown threatens to disrupt operations, reduce passenger demand, and cut into airline revenue if flight restrictions or cancellations become widespread.
