$IAG

Upgrades 4/18: $BIIB $CEA $CMA $COP $DAL $FUL $GPS $PBF $ZION . Downgrades 4/18: $ADM $APTV $AXTA $BCRX $CLB $CSX $CTRE $IAG $MAC $NMRK $PGR $PXD $QCOM $RDBX $RRGB $RXRX $SBRA $SIRI $SLM $TWTR $UAL $WEN

Democrats are hopeful of making swift progress on stimulus, but the impeachment proceedings of Donald Trump could see bipartisan support struggle. The pandemic continues to eat away at confidence – now the British government is said to be considering extending lockdown for another 3 months beyond Easter. This is to get the second dose of vaccines to all over-50s, but just extends the pain for everyone, particularly travel stocks as it’s starting to appear as though another peak summer season will be affected by Covid restrictions. IAG, Ryanair and EasyJet declined 6-7 per cent in early trade. It’s lockdown ad infinitum: the government continues to act as the executive branch of the NHS. I’m reminded of a Malcolm X quote, which goes something like ‘nobody can give you freedom, you take it’.

With France being added to the quarantine list for the UK, travel & leisure is under pressure. Shares in IAG, Ryanair, Tui and EasyJet were all sharply lower as the move will force a large swathe of cancellations right at the peak of the summer holiday season for one of the largest markets for UK tourists. Half a million Brits are thought to be in France right now. Related stocks were also hit. WH Smith – purveyor of overpriced sweets and free Evian – slipped down the board as a result. Apart from the immediate damage this will do at the height of the school holidays and peak summer season, the quarantine decision also underlines the inherent risk you take in booking a holiday abroad right now, which will do nothing for consumer confidence.

The US travel ban has been extended to the UK and Ireland. Airlines are in total meltdown and face an existential crisis – EasyJet (EZJ) talking about grounding almost its entire fleet, while International Consolidated Airlines (IAG) plans to reduce capacity in April and May by at least 75 per cent. Four more Carnival cruise brands are taking a month-long pause. The chaos in travel & leisure is only just beginning. IAG opened -17 per cent, while EasyJet was 18 per cent lower.