(Reuters) -Major U.S. airline stocks fell sharply in premarket trading on Tuesday after Delta Air Lines ( DAL ) and budget carrier Southwest Airlines ( LUV ) slashed their first-quarter forecasts, stoking concerns about the impact of a slowing economy on travel demand.

Delta Air Lines ( DAL ) slumped 11% in premarket trading after the legacy carrier slashed its first-quarter profit forecast, while peers United Airlines and American Airlines ( AAL ) were down 8% and 7%, respectively.

The sector-wide slump followed a broad market selloff on Monday after worries of a potential federal government shutdown and tariff jitters ignited fears that the U.S. economy could be heading towards a recession.

Southwest Airlines ( LUV ) also fell 3% after it cut its expectations for unit revenue growth on Tuesday.

The carrier now expects its revenue per available seat mile (unit revenue), a proxy for pricing power, to grow between 2% and 4% during the first quarter, compared with its prior range of a 5% to 7% increase.

U.S. President Donald Trump's tariffs have raised concerns about an economic slowdown and reduced discretionary spending, prompting travelers to exercise caution when planning trips.

The abrupt shift comes as a setback for big U.S. carriers, which just two months ago were benefiting from strong travel demand and high pricing across their networks.

Major U.S. airlines are set to speak at the J.P.Morgan Industrials Conference on Tuesday and are expected to provide insight on the new demand environment and any updates to their expectations for the current quarter.

Citi analyst Stephen Trent said Delta's forecast cut was disappointing, but not entirely unexpected.

"Concerns about US consumer strength, possible DOGE impacts on governmental air travel demand and Federal Aviation Administration (FAA) staffing, US government tariff uncertainties and several high-profile aviation incidents across North America have all occurred since late January," Trent said in a note.

Delta said on Monday it expects profit in the range of 30 cents to 50 cents per share, compared with its previous estimate of 70 cents to $1 per share.