The omicron variant brought IAG shares back into focus, which this Wednesday rebounded after the heavy losses in recent sessions.
“The market overreaction is due to fear, the panic of a new variant in a scenario of uncertainty”, explains Francisco Coll, economist and analyst for the World Tourism Forum, in the podcast of finanzas.com.
The analyst highlights Spain’s exposure to tourism, which already represents 14 percent of gross domestic product (GDP). In addition, the pandemic came after 2019 was one of the best years for the sector.
“We are talking about about 15 percent of employment, it contributes a lot to the economy,” says Coll.
In the first week after Ómicron’s appearance, a quarter of the reservations for the Christmas season were canceled.
“What this tells us is that we will be talking about the recovery after the variance being also very active,” explains the analyst.
IAG, the storm will pass
Regarding IAG, which also had to accept the United States’ veto on international travel at the beginning of the week, Coll points out that the shares “are now discounting what is going to happen.”
“When the pandemic passes by, it will work again, just like tourism,” the expert details.
Thus, Coll explained that after the pandemic there will also be movements in the sector around the concentration of companies.
“It happened with cruises, that 90 percent of the operators are controlled by three companies, the airlines are doing it too,” he said.
And one of the sought-after protagonists could be the Meliá hotel. “The hotels are in the same scenario, they are launching for small companies and the large chains are demanding their purchase,” said the analyst.
Direction: Ismael García // Production: José Jiménez // Realization: Gabriel García // Recorded in Madrid on December 1, 2021