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Latest Share Chat

Airlines boost Britain's FTSE after Ryanair lifts profit outlook

Mon, 03rd Nov 2014 08:56

* FTSE 100 up 0.1 pct

* easyJet, IAG among top risers

* HSBC falls after latest update

By Alistair Smout

EDINBURGH, Nov 3 (Reuters) - Britain's top share indexreceived strong support from airlines on Monday after Irish peerRyanair lifted its profit forecast, though gains werelimited by weakness in HSBC and miners.

Airline operators easyJet and International AirlineGroup, which owns British Airways, rose 3 percent and1.6 percent respectively after the update from Ryanair.

The FTSE 100 edged up 3.25 points, or 0.1 percent,to 6,549.72 by 0836 GMT, holding its ground after strong gainslast week on the Bank of Japan's unexpected boost of itsmonetary stimulus programme.

The FTSE 350 travel and leisure sector rose 0.8percent, the top sectoral gainer, and is up 13.2 percent sinceOct 16.

The sector hit its lowest level for a year in October, withsentiment knocked by worries over whether the spread of Ebolaand unrest in the Middle East could severely limit travel.

However, Ryanair's figures came a week after IAG increasedit profit guidance, lifting sentiment.

"There's plenty of positive momentum in the airline sector,and it's a solid set of numbers that is being well received bythe market," Atif Latif, director of trading at GuardianStockbrokers, said.

"We have seen sector weakness and volatility over the lastfew weeks led by geopolitical concerns and Ebola headlines ...but we do see a move higher in capacity trends."

Early gains were curtailed after HSBC gave itslatest corporate update at 0815 GMT, shortly after the marketopened.

Europe's biggest bank fell 2 percent, wiping over ninepoints off the index, after reporting a 12 percent fall inunderlying earnings after costs rose.

The Asia-focused bank also set aside $378 million to pay apotential fine from the UK regulator for alleged manipulation ofcurrency markets.

The banking sector dipped 0.5 percent, partlyretracing a 2.9 percent surge on Friday, made after the Bank ofEngland's new regulations for the sector were less strict thanexpected and as investors welcomed new policy action in Japan. (Editing by Andrew Heavens)

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