Travel stocks help FTSE to two-year high

Another strong day on global markets, led in London by travel giants, helped the FTSE 100 push to a two-year high on Wednesday.

The index ended 76.35 points higher at 7643.42, a rise of 1%.

“Travel and leisure have once again been out front with Tui, Wizz Air and easyJet helping to underpin the FTSE250,” said Michael Hewson, an analyst at CMC Markets.

“The Prime Minister’s announcement that Covid isolation in England rules could end at the end of this month has given a leg up to the likes of Whitbread, Cineworld and Kingfisher, while IAG is also higher, as reports circulate it could be forced by Brussels rules to spin off its UK operation British Airways, due to EU ownership rules.”

BP was also boosted, up 2.8%, as the price of Brent crude oil rose 1.3% to 91.99 dollars per barrel.

Mr Hewson added: “European markets have seen another strong session today, with the FTSE 100 setting a new two year high, while the FTSE 250 has also seen strong gains due to some outperformance in companies who are most exposed to the ebb and flow of the UK economy, and the announcement of a possible easing of Covid restrictions in England, at the end of this month.”

In Europe and the US markets were also looking up on Thursday. New York’s S&P 500 had gained 1.2% by the time European markets were closing. Despite falling behind its Wall Street neighbour, the Dow Jones put in a solid 0.8% rise.

In Germany the Dax rose 1.6% while Paris’s Cac 40 was up 1.5%.

In currency markets one pound could buy 1.3554 dollars, a 0.06% rise, or 1.1847 euros, down 0.05%.

In company news, shares in GSK dropped 1.7% after it revealed a 14% drop in pre-tax profits over the last three months of 2021.

The business is pushing ahead with a plan to spin off its consumer healthcare business.

In a call with reporters the chief executive was tight-lipped over whether there had been any approaches to instead buy the division.

GSK was itself the target of an approach by Unilever to buy the entire company earlier this year.

But the potential deal rapidly fell apart.

Shares in airport services company John Menzies jumped 38% after bosses said they had rejected a takeover bid worth nearly £470 million.

The jump increased the company’s value to £425 million, a massive increase but well below the bid.

It implies that investors are not sure that a new and higher bid will be made.

The Edinburgh-based company had previously rejected a lower bid from the same Kuwaiti suitor, National Aviation Services.

The biggest risers on the FTSE 100 were Ocado, up 75p to 1,300p, IAG, up 7.8p to 174.96p, ITV, up 4.95p to 119.75p, Admiral Group, up 119p to 3,074p, and Antofagasta, up 48p to 336.6p.

The biggest fallers on the FTSE 100 were Evraz, down 16p to 445p, United Utilities, down 3p to 139.1p, Sainsbury’s, down 4p to 277.4p, Standard Chartered, down 8p to 563p, and GlaxoSmithKline, down 23p to 1,620.8p.