Delta Air Lines (DAL) shares plummeted 7.05% in Friday's trading session, as the airline faced a perfect storm of negative factors. The steep decline was triggered by a combination of an analyst downgrade, growing concerns over newly imposed tariffs, and an industry-wide selloff in response to China's retaliation against U.S. trade measures.

TD Cowen dealt a significant blow to investor confidence by slashing its price target for Delta from $82 to $45, while maintaining a Buy rating. This dramatic 45% reduction in the price target sparked concerns about the airline's near-term prospects and suggested a reassessment of the company's outlook in light of recent market developments.

Adding to the pressure were the looming threats posed by new tariffs imposed as part of U.S. President Donald Trump's "Liberation Day" initiative. These tariffs have sent shockwaves through global markets, raising fears of potential retaliation from major trading partners and their impact on the airline industry, which is particularly sensitive to economic fluctuations and international trade dynamics. The situation was further exacerbated by news of China's retaliatory measures against U.S. tariffs, leading to a broad selloff across the airline sector.

Investors are also positioning themselves cautiously ahead of Delta's first-quarter earnings report, scheduled for next Wednesday. With the company's financial performance now under intense scrutiny, market participants appear to be bracing for potentially disappointing results or cautious forward guidance, given the uncertain economic environment. The S&P Composite 1500 Passenger Airlines Index fell 6.8% to over a seven-month low, reflecting the widespread concerns affecting the entire industry. As Delta navigates through these turbulent times, its performance may serve as a bellwether for the broader airline sector in the face of escalating trade tensions and economic uncertainties.