FTSE air stocks hurt by rising $40 a barrel oil price

Oil prices hit another 13-year high and closed at more than $40 a barrel again in New York yesterday, but could have been much worse as the oil futures reached $40.38 in after hours trading.

This has so far lowered the FTSE 100 by 18 points or 0.4% to 4436.4 and the FTSE All-Share index 0.3% lower to 2203.5.

British Airways has been the first to announced it will impose an additional charge on tickets to cover for the increasing cost of fuel, but that has also had a negative impact on its share value, which is so far 6p or 2.3% off at 257.5p.

Budget airline rival EasyJet says it will not add a surcharge on fuel, but its share price is also down 3.25p or 1.5% to 21p.

Having closed the day down 5% on Monday – sparking subsequent losses elsewhere across the globe – the Asian and the Japanese market in particular has rebounded today to give the Nikkei 225 index its biggest gain in 10 months of 2.3% to 11,153.5.

The South Korean Kospi index also leapt 3.3%, its largest gain in 13 months, thanks to a jump in Samsung Electronics and Hyundai Motor shares.

Despite the continuous rise in oil prices, the US markets managed to stand firm by end of trading yesterday, as all three indices made gains, and the Nasdaq rose over 1.8%.

The Dow Jones index closed up 29 points or 0.29% to 10,019 and the S&P 500 index added 8 points or 0.77% to 1,095 while the Nasdaq Composite index leapt way above the other indices and closed the day up 35 points or 1.86% to 1,931.

IFAonline

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