Tuesday, global airlines cut their C-19 coronavirus recovery forecast saying it would take until Y 2024 for passenger traffic to return to pre-chaos levels.
In an update on The China Virus’ crippling effect on air travel, the IATA (International Air Transport Association) cited slow virus containment in the US and developing countries, and a weaker outlook for corporate travel.
Continuing travel barriers and new restrictions in some world markets are weighing on nearer-term prospects, IATA said, cutting its Y 2020 passenger numbers forecast to a sharp 55% decliner.
“The 2nd half of this year will see a slower recovery than we had hoped,” IATA Chief Economist said. June passenger numbers were down 86.5% Y-Y, the organization said, after a 91% contraction in May.
Recovery prospects are weakened by the spread of C-19 in the US and developing countries together representing 40% of global air travel, IATA said.
Business travel may also face a sustained slump, threatening the profitability of long-haul airlines and routes as corporate clients rein in spending and make greater use of video-conferences that have become prominent during lockdowns.
“It will remain to be seen whether we see a recovery to pre-crisis business travel patterns,” Mr. Pearce said. “Our concern is that we won’t.”
Long-haul carriers may need to rely more heavily on cargo to maintain the viability of some routes because of lower business demand.
“For many network airlines, the premium-paying passengers were essentially the ones who drove the profitability.“
Tuesday, the major US stock market indexes finished at: DJIA -205.49 to 26379.28, NAS Comp -134.18 to 10402.17, S&P 500 -20.97 to 3218.44
Volume: Trade on the NYSE came in light at 725-M/shares exchanged
HeffX-LTN’s overall technical outlook for the major US stock market indexes is Bullish with a Very Bullish bias in here.
- NAS Comp +15.9% YTD
- S&P 500 -0.4% YTD
- DJIA -7.6% YTD
- Russell 2000 -11.9% YTD
Looking Ahead: Investors will receive the July FOMC policy statement, Pending Home Sales for June, the weekly MBA Mortgage Applications Index, and the Advance June reports for International Trade in Goods, Retail Inventories, and Wholesale Inventories Wednesday.
Have a healthy day, Keep the Faith!