International Consolidated Airlines
IAG, the owners of Iberia, Aer Lingus, British Airways and other airlines saw its stock take a hammering in early trade on Monday as markets reacted to the news of the US strikes on Iran. Hopes that this war would be over quickly are already fading fast, so with global travel badly disrupted combined with a jump in oil prices, the airline sector is understandably squeezed. The IAG share price was down 8% shortly after the open. Wizz Air traded down 7% and easyJet down 5%.
Another travel sector constituent suffering was PPHE Hotels although in addition to the downside from potentially lower tourism rates off the back of the weekend’s events, the company also announced that it had acquired the freehold to a London property. Whilst the headline metrics on the deal look alluring – the property was sold in 2017 for £161m in a sale and leaseback agreement and has now been repurchased for £148m. The move is potentially further complicated by the fact PPHE will fund the deal with a new debt agreement that hasn’t been concluded. Will the terms available this week be as good as they were previously? The PPHE share price was down 8% in early trade.
Again keeping with geopolitical developments rather than market news to reflect the abnormal market conditions and defence specialists BAE Systems is one of the biggest gainers. Shares jumped 7% in early trade amidst expectations of further demand for the company’s services, whilst QinetiQ also fared well. The BAE share price was up more than 7% by 8.45am.
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