Shares in the owner of United Airlines recovered some ground after the airline's boss issued a second statement apologising over its removal of a passenger.
United Continental Holdings stock fell 4% at one point before losses narrowed to finish down 1%.
Videos of a passenger being dragged off a United flight in the US sparked outrage on social media.
United's chief Oscar Munoz apologised for the "truly horrific" incident.
Mr Munoz initially issued a statement on Monday apologising "for having to re-accommodate these customers" before an internal email to United staff emerged revealing that the chief executive had called the passenger called "disruptive and belligerent".
Mr Munoz released another statement later on Tuesday, saying he "continues to be disturbed" by the incident and the company would "fix what's broken so it never happens again".
United Continental Holdings was the biggest faller on the S&P 500 index at the opening bell.
But it started to pare losses in afternoon trading and was given a further boost by a second statement from Mr Munoz.
The footage taken inside the airliner shows a man being pulled out of his seat and dragged down the aisle. He is later seen with blood on his face.
Communications experts have predicted the incident could damage United Airlines' brand.
It comes just weeks after the company, whose slogan is "Fly the Friendly Skies", was criticised on social media for refusing to allow two teenage girls to board a flight because they were wearing leggings.
Wall Street jitters
The recovery in the United share price came as US stocks narrowed their losses in afternoon trading.
Wall Street shares were hit by investor nerves over geopolitical tensions between the US and Russia over Syria.
The S&P 500 share index itself finished 3.38 points lower at 2,353.78.
Investors sought out so-called safe haven assets, with gold gaining 1.6% to $1,274.26 an ounce and the Japanese yen rising 1% against the dollar.