EUROPE MARKETS: European Airlines Skid After Air France-KLM Warning
09 September 2019 - 12:58PM
Dow Jones News
By Steve Goldstein, MarketWatch
European stock markets listless
Shares of Air France-KLM on Monday nosedived on a warning over
bookings, and other airlines weakened, in mostly listless European
stock markets on Monday.
Air France-KLM shares (AF.FR) plunged 9% as the airline said
"close-in bookings in the peak travel period are weaker than
foreseen in view of softening macro-economic environment."
Mark Simpson, an analyst at Goodbody Stockbrokers, said
consensus operating profit forecasts of 1.3 billion euros "will
likely move lower on the implied implications for yields on weaker
close in bookings." The guidance had been for stable pricing for
the network airlines.
Separately, a French minister told Le Parisien that Air France
"wanted to make an offer" for the bankrupt airline Aigle Azur,
Reuters reported
(https://uk.reuters.com/article/uk-air-france-klm-aigle-azur/air-france-klm-shares-slump-on-reports-of-rescue-of-bankrupt-aigle-azur-idUKKCN1VU0MQ?il=0).
Other European airlines including easyJet (EZJ.LN) ,
International Consolidated Airlines Group (IAG.LN) , Ryanair
Holdings (RY4C.DB) (RY4C.DB) and Deutsche Lufthansa (LHA.XE) also
lost ground. British Airways, a unit of International Consolidated
Airlines Group, separately was forced to cancel nearly all of its
flights
(http://www.marketwatch.com/story/british-airways-grounds-nearly-all-flights-as-pilots-strike-2019-09-09)due
to an airline strike.
Broader markets showed little movement. The Stoxx Europe 600
index gained 0.07% to 387.40.
The German DAX increased 0.32% to 12230.31, the French CAC 40
gained 0.03% to 5605.57 and the U.K. FTSE 100 weakened 0.29% to
7261.56.
U.S. stock futures were a bit stronger.
There was a slight bit of positive news on the U.S.-China trade
war front as Politico reported that China offered to make modest
U.S. agricultural purchases -- if the U.S. relaxed restrictions on
Huawei and also delayed the next tariff increase.
U.K. economic data came in better than forecast, with monthly
GDP rising by 0.3% and industrial production edging upward in
July.
Of other notable movers, ProSiebenSat.1 Media (PSM.XE) rallied
5% as UBS upgraded the company to buy from neutral, saying it's too
cheap to ignore despite the macro headwinds.
Associated British Foods (ABF.LN) fell over 2% after reiterating
that adjusted EPS will be flat for the year.
(END) Dow Jones Newswires
September 09, 2019 06:43 ET (10:43 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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