Markets retreat as fears over renewed quarantines bite

Fears that efforts to reopen European travel could slow send Ryanair shares lower

The Dublin market was among Europe’s worst performers on Monday as fears of renewed quarantines hit travel stocks, while energy and financial shares also took a hit.

DUBLIN

Fears that efforts to reopen European travel could slow sent Ryanair Holding's shares into retreat. The Irish airline, Europe' biggest, close 4.26 per cent down at €15.745.

Investors are concerned that fast-transmitting Covid-19 variants could prompt further quarantines. Several European countries signalled that they would demand that non-vaccinated travellers from Britain self-isolate, while Germany pushed to have them barred from the EU.

Dealers said ongoing confusion over travel curbs meant there was no big boost to bookings.

Hotel group Dalata also suffered. Its shares tumbled 6.79 per cent to €3.91, one of the day's worst performances.

Ryanair's fall was one of a number of drops in leading stocks that left Dublin trailing most of Europe on the day. Index heavyweight, building materials group CRH was down 2.62 per cent at €42.70.

Paddy Power and Betfair owner Flutter Entertainment shed 3.83 per cent to €154.55.Dealers noted that shareholder Fastball is nearing the end of a lock-in period, so investors expect that group to offload some stock in the Irish betting business.

Both banks were weak. Bank of Ireland closed 3.15 per cent down at €4.457. AIB ended the day 2.62 per cent off at €2.191. The bank announced that it was buying rival Ulster's business loans.

LONDON

Aer Lingus-owner International Consolidated Airlines' Group (IAG) tumbled almost 6 per cent as concerns over fresh travel curbs hit most carriers. Shares in the company, which also owns British Airways along with Spain's Iberia and Vueling, closed 5.91 per cent down at 176.4 pence sterling.

Low-cost competitor Easyjet, a key rival of Irish giant, Ryanair, slid almost as much, shedding 5.8 per cent to end the day at 899.6p.

Elsewhere, luxury goods group Burberry slumped 8.67 per cent to 2,055p after saying that chief executive, Marco Gobetti was stepping down to take the top job at Salvatore Ferragamo in his native Italy. The fall left the stock languishing at the bottom of the blue chip FTSE 100 index, which itself endured its worst day in a week.

Oil major BP fell 3.18 per cent to 315.15p as investors swerved energy stocks on fears that rising Covid cases in Asia could hit oil demand.

The FTSE 100 has gained 0.9 per cent so far in June and is on track for a fifth straight monthly gain on expectations of a stronger economic recovery on the back of accelerating vaccine rollouts and ultra-loose monetary policies.

However, the UK-focused FTSE 250 is set for its first monthly drop since January as Britain delayed its complete reopening on concerns over a recent spike in Covid-19 infections. It declined 0.5 per cent on Monday.

EUROPE

Oil major Royal Dutch Shell slid 3.41 per cent to €16.94 as energy stocks generally declined. Energy stocks fell 2.3 per cent with oil prices dropping as a spike in Asian infections of the Delta Covid variant threatened to dent demand.

Air France KLM shed 4.08 per cent to €4.14, while German group Lufthansa fell 3.6 per cent to €9.50.

Luxury goods maker Salvatore Ferragamo, where Burberry boss Marco Gobetti is due to take the helm, dropped 2.67 per cent to €18.79.

US

The Nasdaq jumped to an all-time high on Monday, supported by tech-related

stocks amid fears over a spike in Covid-19 cases across Asia, while investors awaited data on the US labour market in the week.

Stay-at-home winners including Microsoft, Apple, Amazon. com and Nvidia were among the biggest boosts to the S&P 500 and the Nasdaq.

In contrast, reopening sectors dropped sharply – financials , energy and airlines fell between 1.2 per cent and 3.5 per cent. All major S&P sectors fell, except technology and utilities, which gained 1.1 per cent and 0.8 per cent.

Additional reporting - Reuters

Barry O'Halloran

Barry O'Halloran

Barry O’Halloran covers energy, construction, insolvency, and gaming and betting, among other areas

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