UK airline stocks, including Ryanair Holdings plc (LON: RYA), British Airways owner International Consolidated Airlines Grp SA (LON: IAG) and EasyJet plc (LON: EZJ), fell amid fears of new lockdown measures.
The airlines are likely to be worst hit by new lockdown measures, which brought the global air travel industry to a halt in 2020 at the beginning of the pandemic.
Ryanair Holdings plc (LON: RYA) share price was down 7.78% at writing, while International Consolidated Airlines Grp SA (LON: IAG) share price had fallen 10.83% at the same time. Lastly, EasyJet plc (LON: EZJ) share price had registered a 9.38% decline at writing.
The airline shares had recorded much deeper losses but had recouped some of their losses at writing as the markets stabilised.
The main trigger behind today’s massive selloff in most global stock indices was the new COVID-19 variant known as B.1.1.529, discovered in South Africa. Scientists say that the variant is resistant to vaccines and has multiple mutations.
News of the new COVID-19 variant was released earlier today triggered a massive selloff in most global stock market indices across Asia, Europe and the Americas.
Investors dumped stocks, generally regarded as riskier assets, for safe-haven assets such as the US dollar, the Japanese yen, US Treasuries and bonds.
The chart below shows the performance of the three UK airlines overlaid on the same chart, showing the percentage losses in each stock.
Chart showing UK airline stocks performance today.
Investors should keep in mind that the percentage losses shown on the chart are cumulative in the figures shown on the chart that add up the losses of the previous stock.
Hence, IAG’s percentage decline is not 32.89% but is 18.9% since we have to subtract the 13.99% EasyJet share price decline. The same applies to Ryanair’s 39.31% loss, which in reality is 6.42% since we have to subtract the previous figure of 32.89%.
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