Airlines' Outlook Less Rosy Due to Fuel Costs

Most airlines are expected to make money this year, but higher fuel prices, leveled-off demand and little or no prospects for airfare increases on domestic routes have wiped the big smiles off the faces of many airline executives.

Prices for airline shares, which had soared early in the year on lower fuel prices and speculation about airline mergers, plummeted last week on the downward earnings estimates and rising fuel prices.

On Friday, the Dow Jones Wilshire U.S. Airline Index and the American Stock Exchange Airline Index were each down 4 percent for the day.

AMR shares fell 4.8 percent to $26.35 for the day, and were down 35 percent from a Jan. 19 high of $40.66.

Shares in Southwest Airlines were down 1.5 percent.

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