By Sam Boughedda
Investing.com — U.S. airline stocks are on the rise on the first trading day of the new year despite flight cancellations continuing to cause disruptions in the industry.
According to FlightAware, there are over 2,200 total cancellations of flights within, into, or out of the U.S. on Monday. Meanwhile, 2,340 flights within, into, or out of the U.S. have been delayed.
It adds to the thousands of flights canceled over the weekend and last week due to extreme winter weather. In addition, the holiday period saw airline staff testing positive for the Omicron variant, resulting in an increasing number of crew members having to take time off from work to isolate, creating a staffing crunch that forced airlines to shuffle flight schedules. Reports over the weekend said some airlines were offering higher pay to flight crews during January in an effort to keep flights moving.
Despite the current difficulties, airline stocks have rallied Monday. American Airlines Group (NASDAQ:AAL), Delta Air Lines Inc (NYSE:DAL), United Airlines Holdings Inc (NASDAQ:UAL), Southwest Airlines Company (NYSE:LUV), JetBlue Airways Corp (NASDAQ:JBLU), Spirit Airlines Inc (NYSE:SAVE), and others have all experienced a jump in stock prices as investors look past the current issues, expecting that travel will continue to pick up throughout 2022.
Earlier today, analysts at Citi told investors that Omicron is a "modest near-term risk," and although the variant could disrupt travel, it is not 2020, with vaccination rates and anti-viral treatments being just some reasons why negative price reactions to future variants look "increasingly unreasonable."