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US Airways filed Chapter 11

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Airline stocks are under selling pressure in overseas trading after US Airways Group (NYSE:U) $2.45 said Sunday it has filed for bankruptcy protection. Shares of US Airways (U) fell 80% to $0.50 on Instinet trading. While analysts expect the airline to eventually emerge from bankruptcy intact, but relatively smaller in size, other airline stocks and some of its lenders will be under some selling pressure near-term.

According to French broker BNP Paribas, US Airways' lenders include Credit Suisse (NYSE:CSR) $21.10 and Bank of America (NYSE:BAC) $68.81.

Shares of major European carriers were lower in overseas trading with German-based Lufthansa and London-based British Airways (NYSE:BAB) $23.25 both trading down more than 4% in their respective markets. In Paris, Air France was down 1%. US-based UAL Corp. (NYSE:UAL) $5.20, fell $-1.38 to $3.28, or 26% on the New York ECNs.

Stock futures here in the U.S. point to a lower open as S&P futures (sp02u) trade down 12.8 point (-1.4%) at 895. NASDAQ futures (nd02u) are lower by 11 points (-1.17%) at 928 and Dow futures (dj02u) are down 115 points (-1.31%) at 8,610.

Fair value for the S&P 500 today is $0.58. That price will not change during the day. HL Camp & Company has their computers set for program buying at $2.05 and set for selling at $-1.85. Fair value for the NASDAQ-100 today is $2.20.

Most actively traded stock in the pre-market have shares of Intel (NASDAQ:INTC) $17.86 trading down 53 cents at $17.33 after Salomon Smith Barney analyst Jonathan Joseph cuts INTC's Q3 estimates to $0.12 and $6.44 billion from $0.14 and $6.78 billion (company guidance was revenues of $6.3-6.9 billion), citing somewhat sluggish pickup in PC component sales thus far in Q3. Mr. Joseph also cut his price target to $25 from $27.

Cisco Systems (NASDAQ:CSCO) $13.12 trade lower by 17 cents at $12.95 and LM Ericsson Telephone (NASDAQ:ERICY) $0.64 trades flat on 177,400 shares traded.

Jeff Bailey
Senior Market Technician
Option Investor

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