UK airline stocks cushioned by hopes for big June travel restart

Save Our Summer: British pilots call on politicians to rescue travel industry
Save Our Summer: British pilots call on politicians to rescue travel industry   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<p><body> <p><span class="caps">LONDON</span> (Reuters) – British airline stocks lost ground on Monday after the government set out a limited reopening of travel, but losses were cushioned by hopes that a bigger take-off would be on the cards for June. </p> <p>British Airways-owner <span class="caps">IAG</span>, easyJet, Jet2 and <span class="caps">TUI</span> were all down between 2-3% as they traded for the first time since Britain said on Friday that travel could restart but only to a handful of places, including Portugal, Israel and Iceland.</p> <p>The top four destinations for British travellers – Spain, France, Italy and the United States – were left off the country’s travel “green list”, but confidence in the industry is growing that by June those countries will make it. </p> <p>“We expect the number of countries on the green list to grow next month to include many of our popular summer destinations,” easyJet Chief Executive Johan Lundgren said in a statement.</p> <p>Britain has said it will review every three weeks the green list – places for which quarantine on return is not required – giving two more chances for Britain’s main summer holiday destinations to make it before peak season starts in July. </p> <p>Goodbody analysts said that Spain, Italy, France and the United States should make the grade by the time of the next review. </p> <p>“We see expectations of a significant shift in bookings starting in June as these changes occur, barring of course the emergence of any new variants in these countries in the meantime,” Goodbody’s Mark Simpson said. </p> <p>Davy analyst Stephen Furlong said that while the initial list was “a bit of a damp squib”, airlines were preparing for a late summer. </p> <p>“Rather than you know May to September, I think we’re probably talking about July to October,” he said, representing a shift in the peak season to accommodate the expected loosening in <span class="caps">COVID</span> restrictions. </p> <p>Crude prices rose on Monday, which Furlong said would also be weighing on airline stocks.</p> <p>Expectations that unrestricted travel will be possible later this year due to the roll-out of the vaccine have lifted airline shares this year, with <span class="caps">IAG</span> up 31% and easyJet up 28% since the beginning of January. </p> <p>Flights website Skyscanner told the <span class="caps">BBC</span> that bookings to Portugal from the United Kingdom saw a 660% increase on Friday compared to the previous day. </p> <p>“There’s very strong demand out there and as the capacity fills, it’s pure supply and demand, so we have seen those prices increase,” said Hugh Aitken, the company’s flights chief.</p> <p/> <p> (Reporting by Sarah Young; Editing by Angus MacSwan)</p> </body></p>