Wall Street opened Thursday on a muted note, but airline stocks surged after Delta Air Lines (NYSE:DAL) posted impressive earnings and raised its outlook for the rest of 2025. While the broader market showed little movement, investors rewarded the airline sector with a rally that turned heads across the financial world.
The S&P 500 dipped 0.1% at the start of trading, alongside the Dow Jones Industrial Average, which fell by 28 points. The tech-heavy Nasdaq Composite also slipped 0.1%, despite reaching an all-time high the day prior. But Delta’s performance created a pocket of optimism in an otherwise flat session.
Delta’s 2025 Guidance Ignites Sector Rally
Delta shares soared 12% after the airline beat Wall Street’s expectations on both revenue and profit for the second quarter. Even more impactful was its upbeat projection for the remainder of the year, signaling strong travel demand despite macroeconomic uncertainty.
Just a few months ago, Delta and other major U.S. carriers had scaled back forecasts due to concerns about tariffs and spending slowdowns under President Donald Trump’s policies. However, Delta’s latest guidance marks a clear reversal, suggesting that the summer travel season will outperform earlier expectations.
The positive report had a ripple effect. United Airlines Holdings (NASDAQ:UAL) climbed 8%, while American Airlines Group (NASDAQ:AAL) gained 7.4%. The broader lift in airline stocks demonstrates how a single earnings report can restore confidence in a sector that had been under pressure.
WK Kellogg Jumps on Acquisition News
While airline stocks stole the spotlight, WK Kellogg Co. (NYSE:KLG) also made headlines, jumping more than 50% in premarket trading. The surge followed a Wall Street Journal report that Italian confectionery giant Ferrero Group—maker of Nutella—is close to acquiring Kellogg for approximately $3 billion.
Such a deal underscores continued M&A activity in the food sector and investor appetite for premium consumer staples brands with room for growth.
Copper Prices Climb, Asia Mixed
Outside of equities, copper prices moved higher, reflecting strong demand from industrial sectors and clean energy initiatives. Meanwhile, global markets painted a mixed picture.
In Asia, South Korea’s Kospi rose 1.6% to 3,183.23 as semiconductor stocks followed Nvidia’s (NASDAQ:NVDA) overnight rally. The Bank of Korea also kept interest rates steady, offering further support to investor sentiment.
Japan’s Nikkei 225 slipped 0.4% to 39,646.36 due to exporter weakness amid yen appreciation and stalled U.S.-Japan trade negotiations. The Hang Seng Index in Hong Kong added 0.7%, and the Shanghai Composite edged up 0.5%. Australia’s S&P/ASX 200 gained 0.6%.
European Markets Steady; Oil and Dollar Slip
European equities were mostly positive at midday. The FTSE 100 rose 1.2%, Germany’s DAX edged up 0.1%, and France’s CAC 40 gained 0.5%, showing cautious optimism despite headwinds like inflation and geopolitical uncertainty.
In energy trading, U.S. crude oil prices fell 48 cents to $67.90 per barrel, while Brent crude declined 38 cents to $69.81. Currency markets saw the dollar tick up slightly against the yen to 146.35, while the euro slipped to $1.1712.
Outlook: Will Airline Stocks Maintain Altitude?
Delta’s report has provided a welcome tailwind for airline stocks, but the question remains: can this rally continue through the second half of the year? With the Federal Reserve signaling caution and inflationary pressures lingering, investors will be watching closely for continued strength in travel demand and further positive guidance from other carriers.
If earnings season delivers more surprises like Delta’s, airline stocks could continue flying high—regardless of broader market turbulence.
However, potential risks such as geopolitical tensions, fluctuating fuel prices, and consumer sentiment shifts could still impact the sector’s trajectory. Staying informed and adaptable will be key for investors aiming to capitalize on these opportunities.
Long-term growth in airline stocks will also depend on how well companies manage operational costs and innovate to meet evolving traveler preferences. Sustainability initiatives and technological advances could serve as additional growth drivers, making the sector an exciting space to watch in 2025 and beyond.
Featured Image – Freepik
