Nearly $3 bln lost from travel shares after Paris attack, broader market steady
today Nov 16, 2015
European shares were steady on Monday, supported by gains in the energy sector that helped offset a slump in travel stocks following Friday's attacks in Paris that killed at least 129 people.
Energy shares outperformed the broader market because of a rally in oil prices that followed French air strikes against Islamic State targets in Syria.
French shares slightly underperformed as markets opened for the first time since the co-ordinated attacks on Friday evening in Paris by Islamist militants.
Around 2.6 billion euros ($2.79 billion) were wiped off the STOXX 60 Travel & Leisure index amid fears that the sector could be impacted by loss of consumer confidence.
Shares in French hotel group Accor fell 5.1 percent, Air France fell 6.5 percent while shares in Eurotunnel and Aeroports de Paris, the operator of Paris' Charles de Gaulle and Orly airports, were down more than 4 percent.
Luxury stocks were also under pressure. Hermes, LVMH and Kering, which get a large part of their sales from foreign tourists in Paris, were all down more than 1 percent.
"Paris is one of the most important cities worldwide in terms of luxury spending and the timing is not good too - a few weeks before Christmas, the most important period for retailers," said Gregoire Laverne, fund manager at Roche Brune Asset Management.
"Those attacks will definitely have a long-term negative impact on the tourism sector in France, and all sectors (which depend) on tourists, but it cannot be measured yet although the market tends to forecast the worst case scenario."
Some highlighted France's Showroomprive.com as an outperformer in the fashion sector, up 0.3 percent, with Internet-only retailers seen as more insulated from the drop in confidence.
"Companies that retail over the web could outperform," said Clairinvest fund manager Ion-Marc Valahu.
Outside of retail and travel stocks, European stock markets were broadly resilient to the fallout from the attacks, and it was seen as strengthening the case for the European Central Bank to provide further monetary stimulus.
The pan-European FTSEurofirst 300 index edged up 0.2 percent and France's CAC was down 0.1 percent.
$1 = 0.9315 euros
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