Airline Stocks Take Flight On July Fare Surge, Retail Says Not Enough To ‘Undo The Softness’

Airline companies saw their shares lift off in afternoon trading on Tuesday after the Bureau of Labor Statistics showed that air fares saw a jump in July at a time when customers have started to postpone their travel plans amid macro uncertainty.

The index for airline fares increased 4% in July, after declining 0.1% in June, according to the Labor Statistics data. The data showed the July inflation report witnessed a softer-than-expected increase in Consumer Price Index (CPI) at 2.7%. Core inflation, which excludes food and energy, rose to 3.1%, landing at the higher end of forecasts.

Shares of Delta Air Lines (DAL) rose over 8%, American Airlines (AAL) and United Airlines (UAL) stocks jumped 10% and Southwest Airlines (LUV) saw a nearly 4% jump.

Retail sentiment on Delta remained unchanged in the ‘bullish’ territory, while sentiment around American Airlines, United Airlines, and Southwest was in the ‘bearish’ territory, according to Stocktwits data.

A bullish Delta follower noted that customers will “pay up” for travel.

In April, major airlines in the United States had withdrawn annual expectations for the year, as the tariff war had resulted in economic uncertainty and a decline in consumer confidence during the first half of the year. However, in July, Delta issued a new profit forecast for 2025, which came in above Wall Street expectations as the carrier expects travel to stabilize in the latter half of the year.

Another Stocktwits user said that Tuesday’s gains will not ‘undo the softness’ airline stocks have been seeing.

Delta’s stock has declined 4% year-to-date, while American Airlines has lost nearly 27% of its value. Shares of United Airlines have gained over 1% so far this year and Southwest has declined 10%.

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