Trading in travel shares tumbled in markets around the world Monday, amid fears that the outbreak of swine flu in Mexico could turn into a global pandemic.
But shares in pharmaceutical businesses and medical companies have shown strong play. At 1100 GMT the FTSE in London was down by 0.6 percent, with the CAC in Paris down by 1.3 percent and the Dax in Frankfurt lower by 1.3 percent. At the same time shares in airlines Lufthansa and British Airways were down 8.7 percent and 7.8 percent respectively, while cruise company Carnival was down 7.3 per cent and Intercontinental Hotels were down 4.8 percent. Travel agent Tui had seen its shares drop by 4.1 percent, while airline Ryanair had fallen by 4.3 percent and French hotelier Accor by 3.9 percent. U.S. stock futures also fell Monday, reported CNN Money, amid fears as to the extent and severity of the outbreak. But shares in drugs company moved into positive territory. Roche had risen by 6.2 percent and GlaxoSmithKline was up 3.2 percent by 1100GMT. Similarly AstraZeneca rose by 2.8 percent.
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Earlier shares in Asia had ended the day mixed. The Nikkei in Tokyo closed up 0.2 percent and Sydney’s All-Ordinaries was up 0.6 percent. But the Hang Seng in Hong Kong fell by 2.7 percent and Seoul’s KOSPI fell by 1.1 percent. The swings in travel and medial stocks came as the the Mexican economy amid fears that the Mexican economy will also fall victim to the outbreak. China has already banned pork imports from Mexico, and from California, Kansas and Texas. Meanwhile Russia has banned all meat imports from Mexico and the southern United States. On Sunday World Bank President Robert B. Zoellick said that it would give more than $205 million to Mexico to tackle the crisis. Zoellick said in a statement on the bank’s Web site that it would also advise Mexico with lessons learned from other governments during outbreaks of SARS and avian flu. “Part of what we’re doing is also connecting Mexico with other governments that have had this issue,” Zoellick said.
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“When a government gets hit by this, it moves fast. The best thing you can do is talk to somebody else who has been through this crisis” The bank said in a statement that funds would be fast-tracked so that funds to be released within three to five weeks.
