UK shares were subdued on Thursday, as worries about the impact of tougher COVID-19 restrictions in England hit the travel sector and overshadowed a clutch of positive earnings reports.
The blue-chip FTSE 100 was flat in morning trade after opening slightly higher, while the domestically focused mid-cap index gained 0.1%.
Airline stocks Wizz Air, EasyJet and British Airways owner IAG fell more than 2% each, after British Prime Minister Boris Johnson imposed tougher COVID-19 restrictions in England on Wednesday.
“Every indication so far is that Omicron is not as harmful as some of the other variants, it just spreads more quickly,” said Danni Hewson, financial analyst at AJ Bell.
“The travel sector is being hammered … people are looking at it and thinking anything connected with travel is going to be impacted.”
Transport company FirstGroup fell 4.6% after warning of uncertainty in its recovery pace because of new restrictions imposed in England, with passenger numbers on its buses slipping in recent weeks.
Rolls-Royce declined 3.6% and was at the bottom of the blue-chips index on fears that a drop in air travel could hit its business that makes and maintains aircraft engines.
Drugmaker AstraZeneca rose 0.7% after U.S. health regulators authorized the use of its antibody cocktail to prevent COVID-19 infections in individuals with weak immune systems.
Cardboard maker DS Smith gained 1.1% after posting an 80% surge in first-half profit and declaring a higher interim dividend.
Infrastructure company Balfour Beatty gained 1.9%after doubling its revenue in the first half of 2021.
