Airline stocks have taken the biggest knock after reports emerged that lockdown easing in England is set to be delayed by four weeks.

According to widespread reports, most of the current coronavirus restrictions are set to stay in place, which could mean nightclubs will stay closed and capacity limits will continue for sports, pubs and cinemas.

While in theory leisure companies could be most impacted, it was airline stocks that took the biggest hit with British Airways owner International Consolidated Airlines (IAG) down 3% to 197p, budget airline EasyJet (EZJ) falling 2% to 940p and tour operator TUI (TUI) dropping back 1% to 417.4p.

AJ Bell investment director Russ Mould explained: ‘Airlines fared worse as any cautious tone by the Government doesn’t bode well for relaxing guidance on foreign travel. The travel sector is waiting with bated breath to start taking more passengers overseas, but hopes are fading for widespread flying this summer.’

LEISURE STOCKS UNMOVED

But Mould added that leisure companies could be the ones worst affected by any delay to lockdown easing in England ‘as it will require a continuation of social distancing rules, meaning pubs and restaurants can’t operate at full capacity.’

Investors don’t seem too bothered by the risk however, ‘perhaps because speculation points to a mere four-week delay, albeit during a seasonally busy time’, Mould said.

Leisure stocks were generally unmoved by the news, with pub group Marston (MARS) slipping 0.5% to 91p while Wagamama owner Restaurant Group (RTN) traded flat at 129p.

The market as a whole also seemed to shrug off the news, with the FTSE 100 up 0.47% to 7,167.68 and even the more domestically-focused FTSE 250 up 0.36% to 22,815.60.

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Issue Date: 14 Jun 2021