ETF Trends
ETF Trends

Airlines aren’t the only ones feeling grounded by soaring fuel costs: the transportation exchange traded fund (ETF) is in a holding pattern.

Record high prices led to three U.S. airlines reporting big quarterly losses today. UAL Corp. (UAUA), United Airlines’ parent company, posted its biggest loss since a Chapter 11 restructuring two years ago. AirTran (AAI) reversed its year-ago profit, and JetBlue Airways (JBLU) also reported a loss. Their loss was smaller than expected, though, reports Kyle Peterson for Reuters.

Jet Blue is a small component of the iShares Dow Jones Transportation Average (IYT) at 0.6%. The fund also holds 1.9% of Continental Airlines (CAL), which reported losses last week.

Two other major components of the fund, United Parcel Service (UPS) and FedEx (FDX), have reported a drop in deliveries for the first quarter. UPS said earnings through March will miss projections by as much as 7.4%. FedEx said shipments were down 2% in the first quarter and that it would have limited earnings growth this year, reports Mary Jane Credeur for Bloomberg.

Together, both companies deliver 80% of packages in the United States. IYT holds 9.3% of FedEx and 7.3% of UPS.

The prices of oil and gas hit new records today: gas went above $3.50 a gallon, while oil hit $119.90 a barrel, reports John Wilen for the Associated Press.

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For full disclosure, some of Tom Lydon’s clients own shares of IYT.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.