Airline stocks lead drop in investor confidence after Madrid atrocities

AIRLINE stocks were the main fallers on European and American markets yesterday as investor confidence continued to suffer following last week’s bombings in Madrid.

News that blame for the atrocities had shifted from separatist group ETA to Islamic extremists sparked fears of further terrorist attacks and prompted general selling in sectors which are seen as more exposed to terrorist threats.

Investors switched from stocks into less risky government bonds. British Airways fell 6% yesterday, while low-cost carrier Easyjet witnessed a 5.3% decline before recovering some lost ground. Ryanair, which fell over 25% last month following a profit warning, escaped the selling and was unchanged at €4.65. Airlines across the Atlantic also suffered from market nerves, as AMR Corp, parent of America’s biggest airline American, fell by more than 7%. Delta, the third-largest carrier, fell 14%.