United Continental Holdings Inc. and US Airways Group Inc. tumbled in New York trading, dragging an industry index to the biggest drop in more than four months as jet-fuel prices jumped.
Jet fuel for immediate delivery in New York Harbor rose 1.4 percent to $3.29 a gallon, the highest since May 4. The Bloomberg U.S. Airlines Index plunged 6.4 percent, the most since Oct. 3.
United, the world’s biggest airline, fell 9.1 percent to $21.24 at the close in New York, while Tempe, Arizona-based US Airways slid 11 percent to $7.89. Delta Air Lines Inc., No. 2 in traffic behind United, slumped 7.2 percent to $10.05.
All 11 passenger carriers in the Bloomberg index declined today.
On Feb. 3, the gauge reached the highest since June as a U.S. stock rally gathered strength on optimism that the economic recovery was taking hold. The index has tumbled 11 percent since then, even as the broader Standard & Poor’s 500 Index has advanced 1.3 percent.
Jet fuel is approaching last year’s high of $3.42 a gallon, the most since 2008, when the price reached a record $4.36. Fuel accounted for 36 percent of Chicago-based United’s operating expenses last year, and 27 percent of those costs at US Airways, according to data compiled by Bloomberg.