Business Irish

Thursday 28 August 2014

Healthy demand boosts global airline traffic

John Mulligan

Published 04/07/2014 | 02:30

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Ryanair chief Michael O'Leary
Ryanair chief Michael O'Leary

Global air passenger numbers rose 6.2pc in May as economic recovery took hold in most regions.

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All areas except Africa experienced positive passenger growth, according to the International Air Transport Association (IATA).

“We are seeing healthy demand for air traffic to support and help sustain the pick-up in global economic activity,” said Tony Tyler, IATA's director general and CEO.

At European airlines, international traffic climbed 6.1pc in May compared to 12 months earlier. That increase came as capacity rose 5.3pc and the carriers' combined load factor – or percentage of available seats sold - rose 0.6 percentage points to 80.3pc.

Economic activity in the Eurozone has been gaining momentum slowly and recent data suggest that solid increases in industrial production and trade should result in acceleration in Eurozone GDP in the second quarter, noted IATA.

North American airlines saw demand increase 4.4pc in May.

European bourses jump on ECB rate

Attention turned to the European Central Bank again yesterday following last month's rate cut.

European stock markets jumped, posting their biggest three-day rally in 10 weeks as the key ECB rate, as expected, was left unchanged at a record low.

ECB president Mario Draghi said the rates will stay low.

“Draghi can keep the markets happy with words and promises that he will act if needed, but in the end he hasn't really been forced to do so,” said Tobias Britsch, who helps oversee about €24bn in funds at Meriten Investment Management, in Dusseldorf. “He has convinced the market so far.”

The Stoxx Europe 600 Index added 0.9pc to 348.86 in London, bringing its three-day gain to 2pc.

The European equity benchmark gauge climbed 2.3pc in the second quarter, capping the longest stretch of quarterly advances since 2010 and reaching a six-year high last month.

The ISEQ Overall Index mirrored the performance of other European bourses.

It jumped 86.66 points, or 1.8pc, to end the session at 4,837.21.

Movers included drinks firm C&C, the maker of Bulmer's cider. It said that it's on track to deliver mid-single digit operating profit growth in its full financial year, but added that some markets remain challenging.

Shares in the company declined 1.4pc, or almost seven cent, to €4.54.

Shares in Ryanair soared 5pc, or 34 cent, to €7.19 after chief executive Michael O’Leary said that the airline's June passenger traffic was “very strong”.

Bank of Ireland rose 3.5pc to 26.3 cent.

National benchmark indices rose in every one of the 18 western-European markets yesterday, except for Portugal.

France’s CAC 40 added 1pc, while the UK’s FTSE 100 gained 0.7pc, and Germany’s DAX advanced 1.1pc.

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