European equity markets climbed in early trade on Friday, boosted by leisure stocks on hopes the tourism industry will get an uplift from an update to travel rules in the UK, expected later in the day.
The pan-European STOXX 50 Index was up 0.9% after just over an hour of trade, while the CAC 40 in Paris gained 1% and Frankfurt’s DAX 30 added 0.6%.
London’s FTSE 100 was the underperformer, climbing just 0.2% as its heavily-weighted mining sector was hit by falling metals prices and China demand concerns.
Anglo American was worst hit as the world’s biggest platinum miner has seen the value of the precious metal – used in the automotive industry to make catalysers – drop by nearly a third since its cyclical peak in February. Anglo shares were down 3.6% at £27.16.
Iron ore prices have also dropped sharply in recent weeks. Having traded at close to $220 a tonne in July, 62% of Fe fines now trade just below $120 a tonne, and was down by 3.4% on Friday.
Australian iron ore miner Rio Tinto was down 2.7% at £48.74, while its native rival BHP Group shed 1.7% to £19.34. Swiss commodities trader and miner Ferrexpo fell 2% to 324p.
UK travel hopes raised
On the plus side, travel and leisure stocks gained ground on hopes the UK government will lift some of the restrictions facing tourists entering the country when it updates its rules later on Friday.
Many expect the current traffic light system to be updated, with countries on the green and amber lists to be merged into a single “low-risk” category. Also, it is widely expected that the requirement for lateral flow testing – which can cost travellers around £100 a trip – will be scrapped for the fully vaccinated.
Travel agency TUI gained 3.9% to 297p, while airline IAG – owner of British Airways – rose 3.4% to 147.3p. Hotel group InterContinental added 1.7% to £46.39 and The Restaurant Group climbed 3.4% to 109p.
Similarly, in Europe, hopes that EU countries will reciprocate if the UK relaxes its travel restrictions boosted leisure and tourism-related stocks on the EURO STOXX Index.
In France, beverages group Pernod Ricard was up 3% at €188.65 (£161.14), while drinks, fashion and accessories group LVMH rose 2.4% to €643. L’Oréal, the cosmetics group, was 1.8% higher at €390.10 and luxury goods company Kering climbed 2.9% to €640.50.
Amadeus, the Spanish IT provider to the global travel and tourism industry, added 3% to €53.16. Deutsche Lufthansa, the German airline, gained 2.1% to €8.17.