U.S. Airlines Rise for Second Day on Revenue Outlook, Fuelby
Rally for industry index best over two days since October
Delta Air's positive November unit revenue best in a year
Discounter Spirit Airlines Inc. led U.S. carriers in their biggest two-day rally since October on prospects of stronger November revenue and for low oil prices to linger into 2017.
Delta Air Lines Inc. on Wednesday reported a 1.5 percent increase in November for revenue from each seat flown a mile, the first positive number in a year at the world’s third-biggest carrier. That helped ease concerns that the industry’s revenue is being hurt by fare cuts and increased capacity.
The Bloomberg U.S. Airlines Index of 11 carriers also was boosted by a third decline in four days for crude oil, which is refined into jet fuel -- one of the industry’s largest expenses. Supplies will overwhelm demand into next year, and prices might not rally until 2017, oil traders said before an Organization of Petroleum Exporting Countries gathering to discuss production.
The index rose 1.3 percent at the close in New York, after gaining 3 percent Tuesday. Spirit rose 5.3 percent to $40.43, while Delta climbed 1.4 percent to $48.33.