Oil falls boost airlines

Jun 5 2008

A further fall in oil prices put a spring in the step of airline shares British Airways and easyJet today.

Banking stocks also made gains after a note from broker Citi said recent falls in Royal Bank of Scotland’s share price looked excessive.

As a result, the FTSE 100 Index steadied after yesterday’s bleak session to gain 21.5 points to 5991.6 in the first hour of trading.

Among the banks, RBS gained 9p to 258.5p, while Halifax Bank of Scotland cheered 10.25p to 350.75p and Barclays lifted 10.25p to 362.25p. That was despite further gloom from the housing market, with the Halifax reporting a 2.4% fall in prices during May.

BA set the pace at the top of the risers board, gaining 10p to 253.75p after oil prices retreated to 122 US dollars a barrel. EasyJet made similar gains in the FTSE 250 Index, up 8.25p to 323p.

Morrisons delivered one of the biggest falls in the top flight, declining 5.75p to 286.5p after first quarter sales growth of 7% came in weaker than the 9.5% seen over the Christmas period.

Fellow retailer WH Smith moved in the opposite direction, rising 4.5p to 404p, after reporting steady third quarter trading figures.