Pre-weekend bounce

The reopening of European borders and a push from top European tourist summer destinations for Britain to abandon its two-week quarantine for travelers is lifting the airline and travel sectors

Charts (4)

Pre-weekend bounce

The reopening of European borders and a push from top European tourist summer destinations for Britain to abandon its two-week quarantine for travelers is lifting the airline and travel sectors. British Airways parent IAG is trading up an impressive 11.6% and easyJet is following suit with a 9% rally. Cruise operator Carnival is also trading higher as investors are pinning their hopes that Britons will travel abroad this summer after all.

The market rally shows that Britain still has one foot in the pandemic – shops and bars remain closed while concerts, festivals and cinemas are not even on the agenda - while the other foot is out and marching ahead as the country is trying to negotiate its way back to a fully functioning economy. Retail and property shares are already pricing in the reopening of stores next week and an expected return of buyers to the housing market. Yet grim data keeps dousing some of the optimism.

German manufacturing orders saw the largest drop on record in April, falling 25.8%, British consumer confidence fell in May to the lowest level since the global financial crisis and UK house prices fell for a third straight month, although the decline was slightly smaller than in April.

The ECB’s decision Thursday to provide a €600bn stimulus injection to European economies will go some way to help European businesses and industries pick up quickly once all the restrictions are fully lifted and help them mend the damage from the pandemic.

More from Indices

Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.