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Airlines Monthly Report | November

 

Airlines ETF Monthly Report: Key Takeaways

European airline bookings stepped up in the week ended October 22, with international and intra-Europe both up by 14% on a week-on-week basis. The continued strong bookings momentum resulted in total net sales exceeding 50% of 2019 levels for the first time. [1] 

A new survey shows that significantly more people plan to travel during the holidays this year than in previous years. According to PWC's 2021 Holiday Outlook [2], 52% of respondents said they plan to travel during the holidays this year, which is far more than the historical one-third of respondents. The survey shows that the majority (72%) will travel by car, and 57% of those with household incomes above $150,000 plan to travel by airplane. 

American Airlines published an investor update guiding third-quarter revenue to the better end of its prior guidance range and adjusting its capacity outlook in addition to costs. The company now expects revenue to be down 25% versus 2019 levels, towards the better end of prior guidance of down 24% to down 28%. [3]

 

Macro Outlook

The U.S. announced it will lift travel restrictions to fully vaccinated international travellers on November 8. The U.K. government will allow fully vaccinated travellers to take cheaper lateral flow tests from October 24, having previously required expensive PCR tests. [4] 

Evercore ISI’s Airline Survey of Overall Forward Revenue is pointing to improving international revenues, according to the group’s October 18 report. Following moderation throughout August amid rising concern over the delta variant, stabilization in September and improvement early October, the Survey held steady at a 35.0 reading mid-October. Recent better demand came from both domestic travel as bookings recover, and international markets as restrictions eased. [5]

The U.K. government removed 47 countries from its 'red list' in a boost to long-haul international travel. Travelers returning from red list countries need to quarantine in a hotel for 10 days. Only 7 countries remain on the list. Importantly, the U.K. has extended vaccine recognition for travel to a further 37 countries, which should encourage inbound travel. [6]

 

Airlines ETF and Index Performance (As of 31.10.21)

 

1M

3M

6M

YTD

12M

SI

U.S. Global Jets UCITS ETF (Acc)

-6.04%

-3.01%

NA

-13.95%

NA

-13.95%

U.S. Global Jets Index

-5.95%

-2.74%

-14.66%

-13.73%

31.87%

-13.73%

Performance before inception is based on back tested data. Back testing is the process of evaluating an investment strategy by applying it to historical data to simulate what the performance of such a strategy would have been. Back tested data does not represent actual performance and should not be interpreted as an indication of actual or future performance. Past performance for the index is in USD. Past performance is not an indicator for future results and should not be the sole factor of consideration when selecting a product. Investors should read the prospectus of the Issuer (“Prospectus”) before investing and should refer to the section of the Prospectus entitled ‘Risk Factors’ for further details of risks associated with an investment in this product. Source: Bloomberg / HANetf. Data as of 31/10/2021. Please note that all performance figures are showing net data.

 

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