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American Airlines Stock Falls 11.9% on Fears of Possible Travel Curbs

Analyst Team trader
Updated 26 Nov 2021

American Airlines (NASDAQ: AAL) stock fell over 11% in Friday early trading, after mounting fears on travel restrictions throw investors back into bearish pandemic trading patterns. Airlines had an incredibly tough year last year as travel companies hemorrhaged profits while global lockdowns dictated the economy. 

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Off the back of Covid, American Airlines and its competitors began to welcome travelers back to varied flight paths as the public sought to relinquish year-long cabin fever. However, with fears of a tough Covid winter and a new delta variant emerging, AAL stock is starting to feel the constriction once again, with companies like Airbnb and Boeing also tumbling towards the end of the trading week. 

The U.K announced yesterday it will suspend flights from multiple countries in Africa, while the European Commission recommended a hiatus on travel between the EU and Southern Africa. While the US may not be at immediate risk, the new variant demonstrates how quickly travel restrictions can be implemented, and what an immediate effect this can have.

While Boeing, American Airlines, and others have tried to piece together some degree of optimism in the last few months, they may have been cut short by the threatening new restrictions. It appears investors are pre-emptive of further restrictions, represented in today’s 11% stock drop. AAL is showing a gain of 12.8% over 2021, with a daily loss of 13.10% at the time of writing. AAL stock is currently trading at $16.94.

 

 

The AskTraders Analyst Team features experts in technical and fundamental analysis, as well as traders specializing in stocks, forex, and cryptocurrency.