MARKET REPORT: Fears of a lost summer wipes £3bn off travel stocks

Travel stocks suffered another dire session as investors digested the Government’s decision to remove Portugal from its ‘green’ list.

Almost £800million was wiped off the market value of Easyjet, Ryanair, Wizz Air, British Airways-owner IAG and plane engine maker Rolls-Royce as the City braced for another torrid summer.

It followed falls of £2billion among the same stocks on Thursday – meaning shares in some of Britain’s biggest tourism-related companies lost nearly £3billion in just two days. 

Almost £800m was wiped off the market value of Easyjet, Ryanair, Wizz Air, British Airways-owner IAG and plane engine maker Rolls-Royce as the City braced for another torrid summer

The Government announced on Thursday that Portugal – one of just 12 countries on the initial green travel list – would be removed and that no other states would be added.

People arriving in the UK from green list countries do not need to self-isolate upon their return.

Most of Europe is on the amber list, which requires travellers to quarantine for 10 days and take two Covid tests.

Stock Watch – Jubilee Metals

Jubilee Metals made gains after it was given the rights to sift through almost 1m tons of mine waste that contains large amounts of platinum.

The AIM-listed mining minnow specialises in extracting and processing metals from the detritus produced by other mines, which is known as ‘tailings’.

It will start processing around 30,000 tons of the material per month at the site in South Africa.

On Thursday it bought the rights to 255,000 tons of platinum-containing tailings in another part of the area.

Shares rose 9.3 per cent, or 1.7p, to 20p.

The industry has reacted to the decision with fury – with swathes of booking cancellations battering companies’ already ailing finances. 

And analysts have begun to speculate that some airlines may need to tap the market for more cash to stay afloat – or could even face going bust.

Short-haul firms that were more likely to rely on trips to Portugal were the worst affected yesterday, with Easyjet dropping 2.6 per cent, or 25.2p, to 934p and Ryanair by 1.3 per cent, or 0.22 cents, to ¤16.16.

Wizz Air dropped 3.3 per cent, or 153p, to 4533p, while IAG closed down 0.9 per cent, or 1.84p, to 196.34p and Rolls-Royce slipped by 2.1 per cent, or 2.36p, to 107.32p.

But as travel firms struggled, some of the so-called ‘lockdown winners’ made gains.

Michael Hewson, chief market analyst at CMC Markets, said: ‘With airline stocks still under pressure as a result of yesterday’s changes to the travel traffic light system, the likes of Ocado and Just Eat are amongst the best performers on the basis of expectations of a slower relaxation of restrictions.’

Ocado jumped 3 per cent, or 55.5p, to 1884p, while Just Eat closed up 2 per cent, or 126p, to 6411p. 

Both companies outperformed in 2020 as Britons stuck at home ordered takeaways during lockdown and switched to internet shopping.

The wider market finished the week in the black – though only just. The FTSE 100 finished up 0.07 per cent, or 4.69 points, to 7069.04, while the FTSE 250 rose 0.1 per cent, or 30.33 points, to 22,832.73.

Smurfit Kappa was among the blue-chip fallers after it bought a packaging firm in Peru.

The takeover of Cartones del Pacifico – for an undisclosed amount – means the paper and packaging giant now works in 13 countries in Latin America. Shares fell 0.9 per cent, or 33p, to 3736p.

There was more drama at Lekoil. The AIM-listed, scandal-hit energy firm was duped into paying £340,000 to a company called Seawave Invest, which said it would introduce Lekoil to the Qatar Investment Authority and secure a £140million loan.

Seawave then disappeared and Lekoil did not secure the loan.

On Thursday, the company’s board sacked founder and boss Lekan Akinyanmi, who failed to repay a seven-figure loan. But yesterday he said he has no plans to step aside and insisted he is still the boss of its Nigerian arm.

The board does not reportedly have the authority to fire him from this part of the business as it does not own a majority stake in it.

Shares in the group tumbled 6.2 per cent, or 0.1p, to 1.53p as the spat progressed.

Elsewhere, shareholders toasted online drinks seller The Artisanal Spirits’ first day of trading on the junior market. The business raised £15million ahead of its float.

The company plans to plough this into its Scotch Malt Whisky Society division. Shares closed at 117.5p – 5 per cent higher than its listing price of 112p.

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

Read more at DailyMail.co.uk