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Global airlines prepare for a rise in bookings



Global airlines prepare for a rise in bookings

Africa News Portal / Agencies |

20 March, 2021

After an exceptional year for global airlines in 2020 due to the consequences of the pandemic, companies are preparing for a flurry of reservations during the coming period by knocking on the doors of debt markets or offering their shares in the financial markets in order to provide the necessary liquidity for the high demand for these companies after surpassing the worst of the Corona pandemic.
British Airways raised about 1.2 billion pounds from the sale of conventional bonds last week, at a time when some companies, such as the American Sun Country, started to offer their shares on Wall Street to meet their future liquidity needs, according to a report by the British newspaper, the Financial Times.
The resort of global airlines to the market coincides with the trend of investors to rotate their investments from stocks that have benefited from the pandemic, such as shares of video game companies, to investment tools for companies that have been affected by the consequences of Corona with indications of a return to normal life and an expected rise in demand for the products of these companies again.
There is a story that tells about the performance of the US aviation sector stocks since the beginning of this year. Investing data, which Al Arabiya has reviewed, indicates that the S&P index of US airline stocks has risen by 33% since the beginning of this year, while the annual gains of the index have reached about 125% with an increase. Shares from the bottom of their decline last March in the midst of the closure measures taken by governments to confront the consequences of the pandemic.
Shares of major US airlines such as Delta and United have risen more than 60% since last October with the gradual lifting of restrictions on air traffic in the world’s largest economy.
And the matter is not limited to American airlines, as Morgan Stanley data indicates that the MSCI global airlines index has increased by about 20% since the beginning of this year, after losing about 60% over the past year at the height of the pandemic.
Low interest rates have fueled the flurry of issuances of international airline bonds since the beginning of this year, as Refinitive data indicate that the volume of these issuances has reached about $ 14 billion since the beginning of this year, a new record high, up from about $ 5 billion in the whole of 2020.

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