Europe close: Stocks mostly red but airlines fly higher
By Josh White
Date: Thursday 08 Dec 2022
(Sharecast News) - European shares were still mostly in the red at the end of trading on Thursday, as worries over a looming recession dampened sentiment.
The pan-regional Stoxx 600 was down 0.12% at 435.68, as the DAX in Frankfurt eked out gains of 0.02% to 14,264.56.
France's CAC 40 was off 0.2% at 6,647.31, while in London, the top-flight FTSE 100 slipped 0.23% to 7,472.17.
"European airlines are enjoying a day in the sun today, with Bank of America upgrades for the likes of Wizz Air and IAG helping to lift the sector," said IG senior market analyst Joshua Mahony.
"Coming off the back of an incredibly tough time for travel stocks, we are finally seeing commercial passenger numbers tick up towards pre-pandemic levels.
"That is particularly the case in Europe and the US, with Asian travel remaining under pressure as Chinese travel remains constrained."
In equity news, UBS downgraded London Stock Exchange Group to 'neutral' from 'buy' on Thursday and cut the price target to 8,500p from 9,000p as it argued that forex headwinds will more than offset improving execution and valuation.
The news sent the shares lower, with the bourse operator ending the day down 6.44%.
Ryanair reversed earlier gains to slip 0.16%, even after the low-cost carrier said group chief executive Michael O'Leary had agreed to extend his contract to 2028.
French carmaker Renault lost 1.01% as talks between it and Nissan over alliance restructuring looked set to spill into next year, according to Bloomberg.
British American Tobacco tumbled 3.09% despite the company saying it expected full-year revenue growth of between 2% and 4% at constant currency rates, as more people used its e-cigarette and oral nicotine products.
On the upside, Prudential gained 0.33% on optimism towards China's relaxation of its zero-tolerance Covid rules.
British Airways and Iberia owner IAG ascended 1.34%, and Wizz Air flew 4.33% higher after upgrades from Bank of America-Merrill Lynch.
"The fact that the Bank of America has decided to issue such dramatic upgrades for IAG - up 70% - and Wizz Air - up 58% - highlight a growing confidence in a sector that has suffered under a blanket of travel and debt-based fears since early 2020," IG's Mahony added.
Reporting by Josh White for Sharecast.com. Additional reporting by Frank Prenesti.
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