Nearly $3bn lost from travel shares af­ter Paris at­tack

Kuwait Times - - BUSINESS -

LON­DON: Euro­pean shares were steady yes­ter­day, sup­ported by gains in the en­ergy sec­tor that helped off­set a slump in travel stocks fol­low­ing Fri­day’s at­tacks in Paris that killed at least 129 peo­ple. En­ergy shares out­per­formed the broader mar­ket be­cause of a rally in oil prices that fol­lowed French air strikes against Is­lamic State tar­gets in Syria.

French shares slightly un­der­per­formed as mar­kets opened for the first time since the co-or­di­nated at­tacks on Fri­day evening in Paris by Is­lamist mil­i­tants. Around 2.6 bil­lion eu­ros ($2.79 bil­lion) were wiped off the STOXX 60 Travel & Leisure in­dex amid fears that the sec­tor could be im­pacted by loss of con­sumer con­fi­dence.

Shares in French ho­tel group Ac­cor fell 5.1 per­cent, Air France fell 6.5 per­cent while shares in Euro­tun­nel and Aero­ports de Paris, the op­er­a­tor of Paris’ Charles de Gaulle and Orly air­ports, were down more than 4 per­cent. Lux­ury stocks were also un­der pres­sure. Her­mes, LVMH and Ker­ing, which get a large part of their sales from for­eign tourists in Paris, were all down more than 1 per­cent.“Paris is one of the most im­por­tant cities world­wide in terms of lux­ury spend­ing and the tim­ing is not good too - a few weeks be­fore Christ­mas, the most im­por­tant pe­riod for re­tail­ers,” said Gre­goire Laverne, fund man­ager at Roche Brune As­set Man­age­ment.

“Those at­tacks will definitely have a long-term neg­a­tive im­pact on the tourism sec­tor in France, and all sec­tors (which de­pend) on tourists, but it can­not be mea­sured yet al­though the mar­ket tends to forecast the worst case sce­nario.” Some high­lighted France’s Show­room­prive.com as an out­per­former in the fash­ion sec­tor, up 0.3 per­cent, with In­ter­net-only re­tail­ers seen as more in­su­lated from the drop in con­fi­dence.

“Com­pa­nies that re­tail over the web could out­per­form,” said Clair­in­vest fund man­ager Ion-Marc Valahu. Out­side of re­tail and travel stocks, Euro­pean stock mar­kets were broadly re­silient to the fallout from the at­tacks, and it was seen as strength­en­ing the case for the Euro­pean Cen­tral Bank to pro­vide fur­ther mon­e­tary stim­u­lus. The pan-Euro­pean FTSEurofirst 300 in­dex edged up 0.2 per­cent and France’s CAC was down 0.1 per­cent.

EN­ERGY SHARES FIRM

En­ergy stocks were the lead­ing sec­toral gain­ers, ris­ing 2 per­cent, as crude oil prices edged up af­ter France launched large-scale air strikes against Is­lamic State in Syria. Ba­sic re­sources stocks also firmed. KBC rose more than 3 per­cent af­ter the Bel­gian fi­nan­cial group posted a big­ger-than-ex­pected net profit, as a strong per­for­mance in its tra­di­tional bank­ing and in­sur­ance busi­nesses made up for a weaker show­ing of its deal­ing room. Among out­stand­ing losers, Sonova fell 7.5 per­cent as the hear­ing aid maker cut its sales and profit fore­casts af­ter weak cochlear im­plant sales, slug­gish busi­ness with US veter­ans and a squeeze on over­seas earn­ings from the strong Swiss franc. —Reuters

—AP

NEW YORK: Spe­cial­ist John McNier­ney (cen­ter) works with traders at his post on the floor of the New York Stock Ex­change yes­ter­day.

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