24-Jun-2010 4:40 PM

SAS passenger numbers rising; Lufthansa price target increased

European markets were down for a second consecutive day on 23-Jun-2010, pushing airline shares lower. Markets were down after Fitch Ratings decreased BNP Paribas' long-term debt rating to AA- from AA, causing a drop in banking sector shares.

Markets also fell in reaction to a decline in US stocks the day before. In key markets, UK’s FTSE (-1.3%), France’s CAC (-1.7%) and Germany’s DAX (-1.0%) all ended the session lower.

SAS passenger numbers rising

SAS (+2.9%) shares rose after the carrier stated passenger numbers have started to rise. As a result, the carrier plans to increase capacity on long-haul services by 12% after summer 2010 by placing one Airbus aircraft into operation. Services include New York, Chicago, Bangkok and Dubai.

See related CAPA Profile: Route Changes

Lufthansa price target increased

Lufthansa (+2.3%) also gained after Citi increased its price target for the carrier from EUR15.20 to EUR19.00. The analysts stated underlying earning forecasts from Lufthansa have “little changed” – despite EUR200 million in volcanic ash costs – implying the carrier is recovering from the global financial downturn. Citi expects trading to be “strong”, particularly cargo and long-haul operations.

See related CAPA Profile: Outlook, Forecasts, Guidance

Elsewhere, Dart Group (+1.4%), Aer Lingus (+1.3%), easyJet (+1.2%) and TUI Travel (+0.7%) rounded out the airlines that rose for the day. Turkish Airlines (-2.9%) was the day’s biggest decliner, moving lower with the Istanbul Stock Exchange (-1.9%). Aeroflot (-2.9%) and Vueling (-2.6%) were also down.

Europe selected airlines daily share price movements (% change): 23-Jun-2010