Negative course on stock markets, with focus on travel companies

Global stock markets followed a negative course yesterday, in reaction to the conflict in Iran, but a more significant decline was recorded only in Asia.

In Europe, major stock exchanges recorded moderate declines, of 1-3%. London's FTSE 100 index was declining by 1.3% at 15:50 local time, Germany's DAX by 2.5% after 16:30 local time, France's CAC 40 by 2.2%, and Italy's FTSE MIB by 2.3%. STOXX Europe 600 was down 1.8% at the time.

Companies related to the travel and tourism sector fell more sharply as global disruptions in the sector persisted. Shares of International Consolidated Airlines, the owner of British Airways, fell by almost 5% in the second half of the day, those of TUI AG - by 10%, shares of the carrier Lufthansa lost over 5%, those of Air France-KLM, over 8%.

Renta4 analysts highlighted that, despite the conflict in Iran, European stock markets recorded "moderately intense declines".

In contrast, some European defense stocks were growing yesterday. Shares of the British defense company BAE Systems advanced by over 5%, those of the Italian group Leonardo - by 3%, as did those of the German company Renk.

US markets also fell in the context of the conflict in Iran. The decline, however, was small. The Dow Jones Industrial Average fell 0.4% at 11:00 a.m., the S&P 500 fell 0.3%, and the Nasdaq Composite fell 0.1%. United Airlines Holdings fell 3.7%, Delta Air Lines fell 2.7%. Exxon Mobil rose 1%, as did Chevron, as crude oil prices rose.

Asian markets also fell yesterday, with airline stocks the biggest losers, as Middle Eastern air traffic disruptions and airport closures rattled travel markets.

Singapore Airlines fell nearly 5%, while Japanese airlines ANA Holdings and JAL each fell more than 5%, while Hong Kong-based Cathay Pacific lost 4%. Shares in Australian airline Qantas fell more than 5%, Taiwan's Eva Air fell 4.5%. Australian oil company Woodside Energy rose 6.8%, Japan's Inpex rose more than 6%, while Hong Kong's China National Offshore Oil Corporation rose more than 10%. Japan's Nikkei 225 index fell 1.4%, Hong Kong's Hang Seng fell 2.1%, and Australia's ASX 200 index rose 0.03%.

In the United Arab Emirates, regulators have closed both the Abu Dhabi and Dubai stock exchanges for the next two days.

Mislav Matejka, an analyst at JPMorgan, said according to Investing.com: "The dramatic events of the weekend will naturally lead to risk aversion, but if someone wants to have a longer time horizon than the next few days/weeks, they should use this weakness to gain.”

Analysts at TD Securities say, according to eu.usatoday.com: "We expect markets to react more broadly to the attacks this weekend than to other recent geopolitical events. This is because the impact is broader. Energy supplies are disrupted in the short term, even if there is a possibility of an extension of the conflict.”