Business Corpus: Southwest Airlines Traffic Caps Wild Week For Delta Air, Other Airline StocksSouthwest Airlines reported March passenger traffic growth outpaced flight capacity, ending a turbulent week for airline stocks. The post Southwest Airlines Traffic Caps Wild Week For Delta Air, Other Airline Stocks appeared first on Investor's Business Daily.

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Southwest Airlines (LUV) on Friday reported passenger traffic that outpaced its flight capacity in March. That caps a turbulent week for airline stocks, which tumbled Monday on trade fears, then ascended on Delta Air Lines' (DAL) stronger Q1 unit-revenue outlook.

March traffic for Southwest Airlines rose 3.7% vs. a year earlier. Capacity, or an airline's supply of available seats and flights, rose 2.4%. Load factor, a gauge of seats filled on flights, rose one percentage point to 85.1%.

Southwest cut its first-quarter unit-revenue outlook in late March citing weaker demand and a "competitive fare environment."

Shares fell 2.8% in the stock market today as U.S.-China trade war fears reignited, hitting the broader stock market. Delta Air Lines (DAL) lost 2.1%, American Airlines (AAL) 3.55%. United Airlines (UAL) retreated 2.9%.

Airline stocks sold off Monday as Wall Street worried about a protracted trade war with China. Zacks analysts also cited a preliminary Transportation Department decision to award flights to Havana to the big three legacy carriers, along with Southwest and JetBlue (JBLU).

The decision, Zacks said, "led to fears of competition intensifying among leading carriers as Havana is popular tourist spot." The competition could lead to fare cuts, eroding profits, Zacks added.

Competition from United forced Southwest to cut its Q1 unit revenue target, some analysts argued. Unit revenue measures sales from passengers in relation to an airline's overall availabile seats and flights.

United Airlines has announced plans to expand, via its airport hubs, into smaller cities where they can charge more for tickets. But that has raised fears that other airlines might respond accordingly.

Airline Earnings On Horizon

Airlines will also report first-quarter earnings in the next few weeks. Delta will be the first, with results due Thursday.

Several winter storms slammed the Northeast in the first quarter, forcing scores of flight cancellations.

As always, Wall Street will be focused on the airlines' outlook for the second quarter. Airfares have ticked up off of lows, Cowen analyst Helane Becker said in an interview this week, but not enough to make up for the rise in jet-fuel prices.

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