Travel stocks have helped lead a FTSE 100 rally as the latest swing in sentiment over the Omicron variant saw global markets bounce higher.
British Airways owner International Airlines Group, which suffered the steepest decline when stocks suffered a big sell-off last Friday, was among the biggest risers on the London blue-chip index on Wednesday, up more than 3%.
Commodity stocks also helped the wider index close the day up by 109 points, or 1.6%, joining a global recovery after a sell-off on Tuesday sparked by pessimistic comments from drugs firm Moderna about the efficacy of COVID-19 vaccines against Omicron.
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Image: The FTSE 100 has been on a rollercoaster ride since plunging on FridayStocks have been on a rollercoaster ride all week, having staged a rally on Monday in the wake of last Friday’s plunge.
AdvertisementOn Wednesday, big FTSE 100 risers had included Whitbread, owner of hotel chain Premier Inn, which added 4% at one stage, and aero engine maker Rolls-Royce though they lost ground and other constituents overtook them in the broad-based rally.
Outside London’s premier index, easyJet gained 4% – as did holiday operator Tui.
More on Covid-19 Related Topics: COVID-19CoronavirusOmicronOil prices staged a recovery too – with Brent crude, having dipped below $70 a barrel overnight, climbing 2%.
It remains well below the highs of more than $86 reached in October.
In Europe, bourses in Frankfurt, Paris and Milan all turned sharply higher.
Image: British Airways owner International Airlines Group saw sharp gainsMarkets have been caught up in anxiety about the Omicron variant as its emergence prompted reinforced travel and other restrictions to be enacted by a number of countries.
Further pressure was applied after comments from Jerome Powell, chairman of the US Federal Reserve, the world’s biggest central bank.
Mr Powell indicated that the Fed’s multi-billion dollar programme of asset purchase support – enacted to try to cushion the economy from the impact of the pandemic – might have to be scaled back more quickly than previously indicated in the face of rising inflation.
0:51 PM: Another lockdown ‘extremely unlikely’Richard Hunter, head of markets at Interactive Investor, said: “UK markets continue to blow hot and cold in the face of Omicron uncertainty, in terms of both the medical and economic impact.
“Taking the lead from a more positive overnight session in Asia, shares were marked higher in opening exchanges in something of a relief rally.
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“Even though there is insufficient information on the latest variant fully to assess the impact, there is an increasing feeling that any fallout would be less severe than that seen in the initial pandemic.
“In any event, and as seen in previous waves, companies are better prepared to deal with any future restrictions having experienced them before.
“Some consider the initial market reaction to the news to have been overdone which has led to some bargain hunting as is the case in the UK today.”
