U.S. air traffic in chaos, travel stocks under pressure on Wall Street

The stock market is closely monitoring the fallout from the government shutdown on the U.S. air transport sector, which has triggered a nationwide flight blackout.

The Federal Aviation Administration’s (FAA) decision to ground thousands of flights across the United States has put the spotlight on major U.S. carriers that could suffer significant financial damage.

In pre-market trading ahead of Wall Street’s opening, airline stocks are showing a decline of around 1%, with industry giants such as American Airlines and Delta Air Lines leading the downturn. So far, Wall Street remains relatively calm.

As reported, the FAA has warned that the aviation crisis will disrupt thousands of flights nationwide. The shutdown has crippled operations at 40 airports, putting 1,800 flights and 268,000 seats at risk. Commercial passenger flights, private jets, and cargo planes are all affected.

Several airlines are attempting to reassure travelers, emphasizing that they will do everything possible to minimize disruptions and losses. However, the government shutdown has also impacted flight crews and other aviation staff, an issue that could exacerbate delays and cancellations.

Meanwhile, across the Atlantic, European carriers are also navigating turbulent skies. Air France’s quarterly results sent its stock plunging more than 13%, weighing heavily on Lufthansa, which dropped nearly 3% in early trading.

As the shutdown sends shockwaves through the skies, investors are watching closely: turbulence in the air could soon turn into volatility on the trading floor.

Andrea Pelucchi