The London market plunged into the red today as details emerged of a “very significant” terrorist plot to blow up aircraft in mid-air.
Airlines were among the worst hit, with British Airways 4% lower, while travel companies and hotel groups such as cruise company Carnival, tour operator MyTravel and InterContinental Hotels also fell heavily.
The concerns of the travel industry were reflected in the rest of the market, with the FTSE 100 Index losing 100 points in the first hours of trading before recovering slightly to stand 80.4 points lower at 5780.1 by mid-morning.
Prior to the alert, analysts had expected the Footsie to open around 40 points lower, reflecting a drop of 97 points for the Dow Jones Industrial Average.
BA was one of the biggest fallers as shares shed 13.5p to 376.5p as more information was revealed about the plot to destroy up to 10 passenger jets in mid-air.
Hotel group InterContinental was the heaviest loser with a 4% slide, down 32p to 833.5p.
In the FTSE 250 Index, MyTravel fell 9.75p to 203p while easyJet slipped 13.5p to 412.25p. Ryanair fell 26c to €7.27.
Newsagent WH Smith lost almost 2%, down 8p to 470.25p. The newsagent is prevalent at airports and the fact that unessential items are now banned from planes will also hamper sales, analysts noted.
Mobile phone giant Vodafone fell 3.25p to 113.25p due to negative sentiment in the sector after Germany’s Deutsche Telekom cut its revenues and profits guidance for the year and blamed fierce competition in its home market. BT was also down, almost 3%, or 6.75p, to 242.75p.
Only two shares in the top flight were trading in the black. International Power lifted 3.5p to 309.75p.
The improvement reflected forecast-busting half year results from the power station operator.
Brewing group SABMiller gained 2p to 1024p.