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Shares of major U.S. airlines fell on Tuesday after news that U.S. regulators have suggested a halt in using Johnson & Johnson’s COVID-19 vaccine.
American Airlines Group Inc.
AAL,
shares led losses, down more than 3%, and Delta Air Lines Inc.
DAL,
stock was off more than 2%. The U.S. Global Jets ETF
JETS,
was down about 1.5%.
The Centers for Disease Control and Prevention and the Food and Drug Administration said in a joint statement earlier Tuesday that there have been six cases of rare blood clots among the roughly 6.8 million people who have received the one-shot Johnson & Johnson COVID-19 vaccine. The agencies are recommending a pause in its use while they investigate with the CDC’s advisory committee to hold an emergency meeting on Wednesday.
The news roiled U.S. markets earlier in the day, but the S&P 500 index
SPX,
was up by a fraction in midday trading.
U.S. airlines have seen an uptick in reservations in March as the vaccine rollout has proceeded without major snags and optimism about summer travel has grown. That followed tepid travel demand in January and February, further hampered by February winter storms.
See also: Who was flying last year during COVID-19? A lot of people carrying guns, according to the TSA
For airlines’ first-quarter results, “a continued smooth vaccine rollout will be key,” analyst Ravi Shanker at Morgan Stanley said in a note Tuesday.
Investors will be keen on hearing comments about future demand, outlook, and other forward-looking financial items, rather than “backward-looking earnings,” he said.
Updates on how summer and second half of 2021 bookings are shaping up “will be critical to investor sentiment in the group,” the analyst said.
Most U.S. airlines are scheduled to report first-quarter earnings next week, with Delta reporting on Thursday.
The Jets ETF has gained nearly 18% so far this year and around 81% in the past 12 months, compared with advances around 10% and 49% for the S&P 500.
