• February 9, 2023

European markets stall but remain buoyed by optimism over a return to more normal travel and leisure

Optimism about the end of social restraints is driving travel and leisure stocks higher and boosting European markets on Tuesday as indices remained flat or fell across the continent. Commodity prices at multi-year highs have also strengthened the markets.

The Europe-wide Stoxx 600
SXXP, -1.30%
fell 0.9% while London’s FTSE 100
UKX, -0.47%
was just below flat. In Paris the CAC is 40
PX1, -0.62%
was 0.2% lower and Frankfurt’s DAX
DAX, -1.70%
fell 1.3%.

Dow futures
YM00, -0.23%
showed down around 20 points that were set for a weak open according to the Dow Jones Industrial Average
DJIA, + 0.09%
reached a slightly higher closing price on Monday and closed at 31,521.

British stocks led European trading as the market picked up on Monday’s news from UK Prime Minister Boris Johnson about the plan to gradually reopen the country.

The UK is among the world’s leading providers of COVID-19 vaccination and the Johnson government has set a tentative early date for the lifting of all social restrictions on June 21st. Domestic holidays could be possible until mid-April.

Also read: Boris Johnson outlines a roadmap to get England out of lockdown

“The FTSE 100 [is] Leading the way in outperforming travel, leisure and commodities stocks with commodity prices at an eight-year high, “said Michael Hewson, analyst at CMC Markets.

All major European markets opened higher but have since given up gains, with most indices falling.

“Travel and leisure stocks are picking up steam this morning after yesterday’s announcement of a reopening plan in the UK spurred a surge in vacation bookings,” said Hewson.

Shares in both British Airways owners IAG
IAG, + 2.95%
and Air France – KLM
AF, + 5.00%
were almost 7% higher with Lufthansa
LHA, + 1.97%
Stock raise more than 5.5%. In aircraft construction is Airbus
AIR, + 2.87%
The stock rose 4% and so did the troubled British engineer Rolls-Royce
RR + 5.97%
jumped close to 9%.

There was also optimism among hotel shares with shares in the InterContinental Hotels Group
IHG, + 0.68%,
Whitbread restaurant and hotel group
WTB, + 2.49%,
and the French hospitality giant Accor
AC + 2.22%
climb everything.

Plus: Bitcoin continues to drop below the all-important $ 50,000 level after Yellen called it “extremely inefficient”.

Major European oil companies also rose as crude oil prices remain at 13-month highs. Brent benchmark
BRN00, + 0.70%
was up nearly 1.5%, trading at over $ 66.15 a barrel.

Shares in BP
BP, + 1.73%,
Royal Dutch Shell
RDSA, + ​​0.18%,
total
UP TO + 1.20%,
and Eni
ENI + 0.62%
all rose.

Strong commodity prices boosted shares in mining giant Rio Tinto
RIO, -0.82%,
Anglo-American
AAL, -0.80%,
and BHP Group
BHP, -0.35%,
all of which increased by more than 1%.

HSBC
HSBA, -1.80%
was a significant decline in European trade, with the global banking giant falling as much as 2% after posting a 34% profit decline by 2020.

Shares in Scottish Mortgage Investment Trust
SMT, -6.24%
were down by more than 5%. The publicly traded trust has significant stakes in major technology stocks like Alibaba
9988, -1.20%
and Tesla
TSLA, -8.55%,
which have recently suffered declines.

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Jack

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