MARKET REPORT: Aviation stocks fall after airport staff are announced to strike during peak summer holidays at Gatwick
Airlines shares fell yesterday after it was announced that airport staff will strike during the peak summer holiday at Gatwick.
Plans for more than 1,000 workers to walk away for four days from July 28 and another four days from August 4 have jeopardized many Britons’ summer holidays.
Striking workers include baggage handlers and check-in staff, with the Unite union saying the move will ‘inevitably’ disrupt flights at the busiest time of the year.
It is another blow to the industry after budget airline Easyjet canceled more than 1,700 summer flights from Gatwick this week, affecting around 180,000 passengers. The airport attributes restrictions to air traffic.
Fear of flopped holiday expectations dragged down the price of several airlines yesterday.
Nowhere to go: The fear of lost vacation expectations has dragged down the price of several airlines
Shares of Easyjet fell 3.8 percent, or 18.1 pence, to 477.8 pence, while rival budget airline Wizz Air fell 3.4 percent, or 95 pence, to 2,676 pence. Investors will listen to see if Easyjet has anything to say about potential turbulence this summer when it updates shareholders next week.
It is expected to post higher sales for the third quarter through June next Thursday, following a summer booking frenzy earlier this year.
British Airways’ owner International Consolidated Airlines also fell before recovering somewhat, falling 0.9 percent, or 1.4 pence, to 154.65 pence, while travel company and airline Tui also fell 1.9 percent, or 11, 5 pence fell to 585 pence.
But Jet2 bucked the trend with shares rising 3.6 percent, or 42 pence, to 1197 pence, continuing a nearly 45 percent rally over the past year. The FTSE 100 closed down 0.08 percent, or 5.64 points, at 7434.57 after hitting a high of 7480 that was quickly wiped out as Wall Street trading began.
Eyes in the City will provide an update on headline inflation next week.
British manufacturer Spirax-Sarco Engineering was boosted by an upgrade from broker UBS to ‘buy’ from ‘neutral’ as it raised its target price from 11,560p to 12,400p.
A message to investors read: “We now see the stock as an attractive entry point.”
Shares in the Cheltenham-based company rose 3.1 percent, or 315 pence, to 10,455 pence. The rise is a good sign for investors, as the share price has fallen 11.44 percent over the past six months.
Shares of AstraZeneca, a maker of Covid vaccines, fell 0.1 percent, or 6 pence, to 10,324 pence, despite HSBC identifying it as one of several biopharmaceutical stocks poised for growth.
The bank said the Cambridge-based pharmaceutical company would grow on drugs backed by strong clinical data.
HSBC added: “Inflationary pressures across most of the world and the political will to contain drug prices are causing the regulatory pendulum to swing against the industry.”
It comes after shares fell 8.8 percent this month following a restrained response to trial results for a drug that aims to slow the progression of lung cancer.
A sea of red engulfed telecommunications giants Nokia and Ericsson after they both posted disappointing financial updates.
Nokia cut its annual sales forecast as customers reversed spending due to higher bills, sending shares down 9.4 percent.
Ericsson posted a dramatic decline in its quarterly profit, with it down 62 percent for the three months ending June, slightly better than market expectations. The stock fell 10.6 percent.
Vodafone was also busy early on, but shares rose and rose 0.4 percent, or 0.27p, to 72.20p.