TAM gains; LAN Airlines reaches 52 week high, but ends session lower
- North and South American airline stocks had mixed performance on 18-Jun-2010.
- GOL was the biggest gainer among South American carriers after receiving a 'neutral' rating.
- TAM also experienced gains despite a decline in the Bovespa, with positive growth in domestic and international traffic.
- ANAC tightened regulations on flight delays, requiring airlines to provide better assistance and faster reimbursements to stranded passengers.
- LAN Airlines reached a 52-week high but ended the session lower, with its stock price showing a bearish trend.
- WestJet saw a rise in stock price after announcing a reduction in fares, while Delta Air Lines and US Airways experienced a drop.
In South America, Brazil's Bovespa (-0.2%) fell for a second consecutive day, after a decline in commodities dragged producers lower. Chile's IPSA (+0.9%) meanwhile rose to an eighth consecutive new high, led by hydroelectric power stocks.
GOL gains on 'neutral' rating
GOL (+3.4%) was the biggest gainer of the day among the South American carriers, after Zacks Investment Research maintained its 'neutral' recommendation of the LCC's stock.
See related report: "Neutral" recommendation for GOL
TAM gains
Fellow Brazilian carrier, TAM (+1.4%), was also up for the day, despite a decline in the Bovespa. Last week, Brazil's National Civil Aviation Agency (ANAC) reported a 9.4% year-on-year rise in the carrier's domestic passenger traffic (RPKs) for May-2010. The carrier also reported a 22.5% in international traffic. Domestic load factor meanwhile rose 0.4 ppt, while international load factor rose 12.3 ppts.
See related CAPA Profile: Traffic and Capacity
In other news, ANAC has tightened regulations on flight delays, meaning airlines will have to provide stranded passengers with food, lodging, telephone and internet access and reimbursements more efficiently. According to AFP, carriers are now required to reimburse fares immediately for flights cancelled or delayed by more than four hours. The carriers previously had up to 30 days to reimburse passengers. ANAC also introduced fines of between USD480-1,500 for airlines that fail to comply.
LAN Airlines reaches 52 week high, but ends session lower
LAN Airlines (-1.1%) reached a new 52-week high during trading before easing into negative territory later in the day. TradersHuddle.com stated the carrier's price action seems to be bearish, its current stock range defined by calculated support at USD18.08 and a resistance level at USD19.70. However, LAN's stock appears to have improved since earlier in the month. LAN ended the session at USD19.67.
LAN Airlines stock price: 18-Mar-2010 to 18-Jun-2010
Source: Centre for Asia Pacific Aviation & Yahoo! Finance
Elsewhere, WestJet (+4.1%) rose after announcing a reduction in fares, while Delta Air Lines (-3.4%) and US Airways (-2.8%) dropped.
North & South America selected airlines daily share price movements (% change): 18-Jun-2010
Source: Centre for Asia Pacific Aviation & Yahoo! Finance