Every so often, stocks of companies in a certain industry all get hammered on the same day. And I'm not talking about some paltry 3% or 4% decline either. I'm talking about a throw the baby out with the bathwater, gut wrenching sell-off.

For example, we all know that financials had their day earlier this year when firms like Citigroup (C) and Bank of America (BAC) wrote down record losses and brokerage giant Bear Stearns (BSC) simply imploded.

But what many don't know is that if you were to check the share price of many financials today, you'd see that the rebound came fast and furious.

The Not-So-Friendly Skies

Yesterday it was the airlines' day to suffer. United (UAL) was down 29%, U.S. Airways (LCC) lost 22%, Delta (DAL) lost 16%, and Continental (CAL) was lower by 13% and AMR Corp. suffered a 24% decline. In fact, one could safely say that the entire airline space has been decimated in 2008.

Yet, Wall Street bargain hunters lined up at the ticket counter after yesterday's record sell off due to (what else?) record oil prices.

According to data from J.P. Morgan which is forecasting a significant sell-off for crude oil in the fourth quarter (down to $92 a barrel), I'm ready to bet that even a modest decline in oil prices will spark a relief rally in the airline industry, sending stock prices soaring.

One that is first in line on the runway is American Airlines (AMR).

AMR: A First-Class Bargain

Yesterday, AMR's shares plunged 24% to close at $6.22. That's well below its previous bottom of $6.81 back in April.

Yet, the stock isn't grounded by any means.

At the company's shareholder meeting yesterday, AMR's Chairman and Chief Executive Gerard Arpey outlined how AMR is taking necessary steps to combat high fuel prices by retiring old aircraft (including at including many of its MD-80s and some Airbus A300 planes) charging for checked baggage, and cutting jobs (unfortunate but necessary).

From my Rational point of view, this sets the company up for a lucrative acquisition or, better yet, a buyout on the horizon. AMR is a buy.

Jamie Dlugosch Editor, InvestorPlace