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HAVE YOU HEARD OF THE NEWS? May 20, 2009

Posted by priscilaraposo in Uncategorized.
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Airline shares hit by flu fears

clip_image001The flu outbreak is causing global alarm

Shares in airlines and travel firms have fallen sharply around the world on concerns about the economic impact of the swine flu outbreak.

With the outbreak in Mexico spreading to the US and Canada, shares in cruise ship operator Carnival were down 7.7%, while British Airways had fallen 7.4%.

Earlier, shares in airlines Qantas and Cathay Pacific had fallen.

Investors fear the flu outbreak may lead to people cancelling overseas trips, or even travel restrictions.

Real concern

Analysts said investors were more cautious than panicked, but still concerned that if the outbreak worsened, especially in the US, it could potentially derail economic recovery efforts.

“In essence, this is an already dangerous time for financial markets so to have this spectre developing right now is just cause for some very real concern,” said analyst James Hughes of CMC Markets.

Health emergency

The UK’s main FTSE 100 index was down 0.7%, or 30 points, at 4,126 in morning trading, while Germany’s Dax had lost 1.6%.

Hong Kong’s Hang Seng share index had earlier ended down 2.7%, with shares in Cathay Pacific losing 8%.

In Australia, shares in Qantas ended down 3.5%.

US soy and corn prices have also fallen on fears that the flu outbreak will cause a slump in demand for pork products, which would hit demand for animal feed.

Meanwhile, Russia has already introduced bans on meat imports from North and Latin America.

However, despite the name “swine flu”, the new strain is not infecting pigs.

The World Health Organization has declared the flu a “public health emergency of international concern”, warning that it could spark a pandemic, or global outbreak.

clip_image002

Shares in airlines have fallen around the world

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