American Airlines share price stabilises after $12 billion bailout request
The airline has seen shares stabilise after requesting a $12 billion bailout from the US government to limit the fallout of Covid-19 on the aviation industry.
American Airlines is seeking a $12 billion bailout from the US government to help it cope with the impact of the Covid-19 pandemic.
American Airlines CEO Doug Parker told employees in a memo that the funds would mean ‘no involuntary furlough or cuts in pay rates or benefits for the next six months’ and ‘allow us to fly through even the worst of potential future scenarios’.
Last week, Congress passed a $2.2 trillion emergency stimulus bill, with $50 billion assigned to the airline industry.
Airline workers at Delta United and American are dealing with reduced pay and hours, as the travel shutdown has led to thousands of flights cancellations around the world.
‘We certainly hope and expect that by that time, the virus will be contained, Americans will be flying again and we will be back to flying a full schedule,’ American Airlines said.
American Airlines shares stabalise amid Covid-19
American Airlines has seen its stock price stabilise, with it finding support at $12 a share in the wake of the US rescue package.
The airline has seen shares fall more than 55% year-to-date after hitting a year-high of $30 a share in mid-February.
On the way down, price action was hugging the lower Bollinger band in an indication of the strength of the move lower, according to Victoria Scholar, presenter and analyst at IG.
‘In terms of key levels watch out for the Bollinger band mid-point for resistance at around $15, which is close to the 23.6% Fibonacci retracement line at $14.84,’ Scholar said.
‘Then look out for $10 on the downside, which is key support and where the market bottomed out. A break below would be highly bearish of American Airlines,’ she added.
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