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Airlines

Global Markets Plunge as Swine Flu Fears Grow

Strategic Insights

— 1 min read

Global stock markets plummeted today in response to growing fears over the swine flu outbreak, with airlines, travel companies, and hotel groups facing significant losses. Share prices in British Airways, Thomas Cook, Carnival, and Thomson Holidays' owner TUI all fell by over 5%, while Intercontinental Hotels dropped almost 6%. GlaxoSmithKline, the British manufacturer of flu drug Relenza, was a rare bright spot, with shares rising 4% on hopes of increased demand from health agencies.

Key Takeaways:

  • British Airways shares fell by almost 12% in London, while Thomas Cook, Carnival, and Thomson Holidays' owner TUI all fell by more than 5%.
  • Intercontinental Hotels dropped almost 6%, and GlaxoSmithKline's shares rose 4% on hopes of increased demand for its flu drug Relenza.
  • Asian markets fell sharply, with Hong Kong down 2.5%, Shanghai down 3.3%, and Singapore off 2.2%.
  • Leading Asian firms, including electronics giants Sony, Panasonic, and Samsung, have told employees to avoid traveling to Mexico City.
  • British Airways operates flights to Mexico but analysts are concerned that its routes to North America will be hardest hit if corporate travel declines.
  • EasyJet and Ryanair shares fell by 6% and 4.5%, respectively, and Thomas Cook shares were down 20.375% at 262p.
  • GlaxoSmithKline has increased output of Relenza from its Australia plant to maximum capacity for the next three months.

Statistics:

  • The FTSE 100 dropped 48.51 points to 4107.48.
  • British Airways shares fell 18.9p to 145p.
  • Thomas Cook shares fell 20.375% to 262p.
  • TUI shares fell off 14.25% to 257.50p.
  • EasyJet shares fell 6%.
  • Ryanair shares fell 4.5%.
  • GlaxoSmithKline's sales of Relenza to governments exceeded those of Roche's Tamiflu by £38 million in the first quarter.
  • Government orders for Relenza totaled £220 million, while those for Tamiflu totaled £182 million.

Sources:

  • NICK GOODWAY
  • "British Airways shares fall 12pc after swine flu fears," The Guardian.
  • "Swine flu fears spark crash on stock markets," BBC News.
  • "Asian markets plummet as swine flu fears spread," Reuters.
  • "GlaxoSmithKline boosts output of swine flu drug Relenza," Reuters.

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