Global airline share prices rebounded in June, driven by the outperformance of North American airline stocks. Prices of international airlines stocks increased by 6 percent following the sharp fall of 10 percent in May, a latest report released by International Air Transport Association (IATA) show.
The IATA report said that since the beginning of the year, the global airline share prices have risen by 2.3 percent, lagging the wider global equity markets by some margin of 14.7 percent.
The IATA is a trade association of the world’s airlines which represents nearly 265 airlines comprising 83 percent of global air traffic.
In June, the North American airline index was the best performer among all regions. Strong passenger demand and higher profit expectations were the main catalysts behind this outperformance despite the ongoing concerns of the extension of the Max 737 groundings.
On the other hand, European airlines continued to underperform the global equity index despite robust traffic volumes. Similarly, downward pressure on passenger yields together with weaker cargo demand is impacting both profitability and the equity market performance for Asia Pacific airlines. Final data of quarter one (Q1) confirmed decline in EBIT margin, led by European airlines.
