Market Overview

Airline Investors Watching Brussels Terrorist Attack Closely

Airline Investors Watching Brussels Terrorist Attack Closely

Deadly explosions rocked Brussels on Tuesday as terrorists targeted the city’s airport and subway system. Overall, U.S. investors appear to be taking a “wait and see” approach to the market.

The S&P 500 is mostly flat in early Tuesday trading, but the stocks of American Airlines Group (NASDAQ: AAL), United Continental Holdings Inc (NYSE: UAL), Southwest Airlines Co (NYSE: LUV) and Delta Air Lines, Inc. (NYSE: DAL) are all down more than 1.0 percent.

Airline investors are hoping that the knee-jerk sell-off to the Brussels attacks will play out in a similar way that initial negative reactions to the Paris terrorist attacks in November quickly dissipated. Within three weeks of the Paris attacks, all of the “Big 4” U.S. airline stocks were trading above their respective pre-attack share prices.

Related Link: There's A 60% Chance The Economy Keeps Firing, And A 20% Chance Everything Goes To Hell

The threat of a disastrous terrorist attack is a threat that long-term airline investors must always take into account. The September 11 World Trade Center attacks sent shares of American Airlines and United Airlines plummeting around 40 percent in a matter of days.

U.S. airline investors will be watching developments in Brussels closely for any indications that the attacks could be part of a more widespread terrorist plot. For now, at least, the market reaction has been minimal.

Disclosure: the author holds no position in the stocks mentioned.


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