FTSE airline stocks slump over UK’s Spain travel quarantine
Airline stocks slumped on the FTSE 100 today in the aftermath of Britain’s move to reimpose a travel quarantine on Spain.
The government scrapped a travel corridor between the UK and Spain over the weekend, after the country recorded 900 new Covid-19 cases for two days running last week.
Airlines blasted the government’s decision, which means travellers to the UK from Spain must now self-isolate for two weeks.
And their share prices sank today, with British Airways owner International Consolidated Airlines Group (IAG) suffering an 8.6 per cent drop.
IAG is reportedly trying to raise €2.75bn by the end of summer after announcing 12,000 job cuts as a result of coronavirus.
Meanwhile. Easyjet plunged 10.8 per cent to 524.8p – just a third of its value before coronavirus led to travel bans around the world.
Ryanair, which also revealed a £168m loss for the three months of lockdown today, dropped 8.3 per cent.
And rival budget flyer Wizz Air slipped 3.9 per cent.
Tour operator Tui also suffered a deep blow over the end of Spain’s travel corridor, sinking 13.3 per cent to 294.3p. Before the pandemic Tui’s stock was close to hitting 1,000p following the collapse of longtime rival Thomas Cook.
“Losses across European and US airlines highlight the growing fear that many airlines will only survive through massive share dilution,” Joshua Mahony, a senior market analyst at spreadbetter IG, said.
Spain has insisted it is a safe tourist destination despite a sharp rise in coronavirus infections since it started easing lockdown.
Some regions have made face masks mandatory but the UK government said it opted against more targeted travel measures.
And the government has not ruled out further measures against other European countries like Germany and France if their infection rates spike.
“We have to keep the situation under review and I think that is what the public would expect us to do,” junior health minister Helen Whately told Sky News.
“If we see rates going up in a country where at the moment there is no need to quarantine, if we see the rates going up, we would have to take action because we cannot take the risk of coronavirus being spread again across the UK,” she said.
A total of 9,835 flights are scheduled to leave the UK for Spain between 26 July 31 August, according to aviation data analysts Cirium.