Reopening in leaps and bounds
Fiona Cincotta May 26, 2020 11:16 AM
Travel firms and hotel chains are dominating the top of the FTSE league table this morning as the reopening across Europe rekindles hopes of summer travel and holidays in the sunshine.
Travel firms and hotel chains are dominating the top of the FTSE league table this morning as the reopening across Europe rekindles hopes of summer travel and holidays in the sunshine. Over the weekend the Canary Islands opened for tourists and on Monday Spain said it would allow visitors from 1 July. France is still imposing a two-week quarantine on travelers from Britain but Italy will allow tourists from next month, as will Turkey.
The renewed enthusiasm for travel firms is channelling large volumes of trade into British Airways-owner International Consolidated Airlines, almost on a par with volumes in Barclays bank. And while shares in IAG, Intercontinental Hotels and travel operator TUI are beginning to make up for heavy losses during the lock down, Premier Inn-owner Whitbread slipped as foreign travel will mean fewer budget travelers at home.
The Prime Minister’s plan to allow UK shops to reopen from the middle of next month is also providing a fillip for clothes, shoes and sports chains pushing Next, JD Sports and Primark-owner Associated British Foods up the FTSE rankings. With the high streets reopening, property sales are also expected to start picking up during what is traditionally the busiest part of the year.
Europe’s first corona-free state
Over the weekend Montenegro became the continent’s first country to declare itself virus-free after the tiny nation didn’t record a single new case in 20 days. This significant milestone holds out the prospect of further opening of European countries and markets, and the possibility that some areas of the European travel business could be up and running before the end of the season.
The STOXX Europe 600 Travel & Leisure index jumped over 6% this morning, marking its highest point since the end of April as some glimmers of positivity crept back into the sector.
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.