Shares of United Airlines Holdings (NASDAQ: UAL) rallied 3.66% at 11:15 ET on Friday morning following the news that the airline reached an agreement with its pilots’ labor union on new contract terms. CNBC United is the first major carrier to strike a deal with its pilots since the beginning of the COVID-19 pandemic, which exacerbated a pilot shortage.
“United Airlines was the only airline to work with our pilots union to reach an agreement during COVID,” wrote United CEO Scott Kirby in a LinkedIn post. “It’s not surprising that we are now the first airline to get an Agreement in Principle for an industry leading new pilot contract.”
While terms of the deal were not disclosed, a statement from union executive council chair Capt. Michael Hamilton called the new contract “industry leading agreement” that recognizes the pilots’ contribution to the “current and future success of United Airlines.”
Delta Air Lines, Southwest Airlines, and American Airlines are still in negotiations with pilots’ unions, which have recently organized pickets to protest arduous schedules.
The agreement still needs to be voted on by the union and by pilots.
This news should impact the Invesco S&P 500 Equal Weight ETF (RSP ) and the Invesco S&P 500® Equal Weight Industrials ETF (RGI ), both of which hold United.
RSP will invest at least 90% of its total assets in securities that comprise the S&P 500 Equal Weight Index, which equally weights the stocks in the S&P 500 Index.
RGI offers exposure to equities included in the S&P 500 Industrials Index, which covers the following industries: aerospace and defense, building products, construction and engineering, electrical equipment, conglomerates, machinery, commercial services and supplies, air freight and logistics, airlines, and marine, road and rail transportation infrastructure, according to ETF Database.
Both funds employ an equal-weight strategy whereby component companies receive approximately equal allocations, resulting in more balanced exposure than other alternatives.
In addition to United, RSP also holds Delta Airlines. RGI, meanwhile, also holds American Airlines, Delta, and Southwest Airlines.
For more news, information, and strategy, visit the Innovative ETFs Channel.
