American Airlines (AAL) stock plummeted 6.21% in pre-market trading on Friday, as investors reacted to a gloomy outlook for the airline industry. The sharp decline comes amid growing concerns about slower growth, higher inflation, and potential US isolationist policies that could significantly disrupt the competitive landscape for airlines.

TD Cowen analysts Tom Fitzgerald and Helane Becker highlighted these challenges in a research note, expressing particular concern about the upcoming second-quarter guidance. The analysts stated, "We are below consensus on 2Q guidance metrics for every US airline and expect management teams to guide conservatively." This pessimistic view appears to have triggered a sell-off in American Airlines stock.

While the analysts still favor legacy carriers over low-cost airlines, expecting any consumer trade-down to occur within the same carrier's cabin rather than between airlines, the overall sentiment remains cautious. The market's reaction suggests that investors are bracing for potentially disappointing forecasts as airlines prepare to report their first-quarter results later this month, with American Airlines' significant pre-market drop reflecting these broader industry concerns.