Yahoo Finance Airline stocks rise on reports UK set to relax travel rules
Airline and travel stocks flew higher on Friday amid reports that the UK government is set to ease current rules for international travel.
British Airways owner IAG (IAG.L) was up more than 5% on the day, leading the FTSE 100, while TUI (TUI.L) climbed 4.9%, and Rolls Royce (RR.L) pushed 2.6% higher as a change in rules would bode better for its core business of making and servicing engines for long-haul aircraft.
Ryanair (RYA.L) and Wizzair (WIZZ.L) were 1.6% and 1.7% higher respectively, while InterContinental Hotels Group (IHG.L), the owner of the Holiday Inn chain, advanced more than 2% on the back of the news.
IHG’s investors will welcome the news as business in China and the Americas has been more brisk of late, but its European trade has been the weak spot as rules kept international travellers at a distance.
The upward momentum came as the Times reported the government is set to remove dozens of countries from its “red list”, meaning travel to destinations including Turkey will be permitted. Currently there are 62 countries on the red list, but that number could be halved.
Transport secretary Grant Shapps is also expected to announce on Friday that the traffic-light system for travel will be simplified going forward, with the amber classification scrapped altogether. All destinations will be either red or green.
In addition to this, the requirement for fully vaccinated people to take PCR tests upon returning to the UK may also be scrapped.
Read more: Airlines stocks slide as they warn new UK travel guidance is not enough
According to sources familiar with the matter the changes will occur in time for October half-term school holidays.
“Companies highly reliant on international tourists saw a jump start to their share price today with a big shake-up in travel rules due,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
“This is the jolt of energy the travel industry desperately needed after months of uncertainty.”
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