US airline stocks closer to biggest annual decline in five years
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US airline stocks moved closer to their biggest annual decline in five years after Credit Suisse Group AG said a critical financial gauge won't turn positive until the end of next year and trimmed earnings estimates for the largest carriers through 2018.
Rising fuel prices, an unwillingness to reduce capacity growth and increased labour costs are adding to a gloomy outlook for carriers that are already contending with sustained declines in passenger revenue for each seat flown a mile, Julie Yates, an analyst at Credit Suisse, said in a note to clients on Wednesday. She cut her recommendation on American Airlines Group Inc to sell from buy, while dropping United Continental Holdings Inc to hold from buy.
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