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Travel stocks rally as Joe Biden hints at restarting flights to Europe

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·Contributor
·3 min read
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British Airways planes at Heathrow Airport, West London, as thousands of people have departed on international flights after the ban on foreign holidays was lifted for people in Britain.. Picture date: Monday May 17, 2021. (Photo by Steve Parsons/PA Images via Getty Images)
Shares in British Airways owner IAG rose as much as 3% on the back of the news in London. Photo: Steve Parsons/PA Images via Getty Images

Travel and leisure stocks received a boost on Friday after US president Joe Biden hinted at the possible restart of transatlantic flights.

In a press conference with German chancellor Angela Merkel on Thursday, he said that the US is looking into when it can lift travel restrictions for Europe, and that more information would be revealed “within the next several days”.

“We brought in the head of our COVID team, because the chancellor brought that subject up,” Biden said.

“It’s in process now. And I’ll be able to answer that question to you within the next several days, what is likely to happen. I’m waiting to hear from our folks, from our COVID team, as to when that should be done,” he said.

There are also further signs that the US is considering easing quarantine measures for double-jabbed travellers.

Read more: How to get travel insurance amid UK rulings on red, green, and amber countries

Shares in British Airways owner IAG (IAG.L) rose as much as 3% on the back of the news in London, while easyJet (EZJ.L), Wizz Air (WIZZ.L) and jet engineer Rolls Royce (RR.L) also climbed higher.

In Europe, Air France (AF.PA) was up 2%, and Lufthansa (LHA.DE) gained 2.5%.

IAG climbed on Friday. Chart: Yahoo Finance
IAG climbed on Friday. Chart: Yahoo Finance

It comes as fully vaccinated American citizens are already permitted to travel overseas if they show evidence of a negative COVID test on return, however, European travellers have been restricted to enter the US since Biden took office in January.

The US has recently been under pressure to ease restrictions, with Europe’s largest automobile industry association, headquartered in Frankfurt, issuing a letter to the US Embassy in Berlin.

“Business travel to the USA must once again be possible without restrictions. The US government is currently locking out European business travellers. It is incomprehensible that the Schengen states are still classified as high-risk areas by the United States,” wrote the Mechanical Engineering Industry Association.

Watch: President Biden meets with German chancellor Angela Merkel

Meanwhile, on Thursday night, Corneel Koster, Virgin Atlantic’s chief customer and operating officer, told the Telegraph: “Vaccination levels are very high in the UK, and very high in the US – if we follow the data the US should open. So should big parts of Europe, and so should other parts of the world. Step by step. Aviation can be rebuilt safely.”

He added: “We are calling on the Biden administration as well to allow Brits to travel there. We are calling on all vaccinated travellers on low risk routes to low risk countries, because the protection is there.”

On Monday next week, coronavirus rules will end in England, with almost all legal restrictions on social contact being removed. Nightclubs will also be allowed to reopen for the first time since the start of the outbreak in March 2020, and capacity limits will be removed for all venues and events.

However, the Delta variant, which was first detected in India, continues to spread across Britain. It is currently the dominant strain of the coronavirus in the UK, making up around 95% of new cases. The number of daily cases hit a six-month high of 48,553 on Thursday.

Watch: Should I book a holiday in 2021?

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