We take a look at what could have spurred travel stocks today
The post What boosted ASX 200 travel shares on Tuesday? appeared first on The Motley Fool Australia. –
The latest findings from Australia and New Zealand Banking Group Ltd (ASX: ANZ) and Roy Morgan showed consumer confidence increased 0.4% last week – its third consecutive weekly gain – despite rising Omicron cases.
Additionally, the Reserve Bank of Australia (RBA) noted similar observations earlier this month.
The minutes for the RBA monetary policy meeting stated the variant increased uncertainty around international travel in November but didn’t impact long-term outlooks.
ASX 200 travel shares took to the skies on Tuesday
For context, the ASX 200 Index gained 0.86% today.
Consumer confidence and travel outlook unchanged by variant
Consumer confidence soared 4.8% in New South Wales last week and Victoria recorded a 1.1% spike. However, all other states reported modest falls. The gains came despite increasing numbers of new Omicron cases.
According to ANZ senior economist Adelaide Timbrell, lower rates of hospitalisations associated with the Omicron variant likely helped consumers’ outlooks.
Right now, 32% of Australians say their families are better off than they were this time last year. At the same time, 38% say they expect their family will be better off financially this time next year.
Meanwhile, the RBA believes the outlook for travel and education exports improved over November.
Additionally, it predicted education exports will contribute to Australia’s GDP in the coming years.
Though, the RBA board noted the Omicron variant had “clouded” near-term outlooks. Particularly, as it could lead to travel hesitancy.
What else might have driven travel shares higher?
Potentially also buoying ASX 200 travel shares is the easing of restrictions for international arrivals.
Instead, they only need to isolate until they test negative for COVID-19.
All arrivals must receive a COVID-19 test within 24 hours of landing. Additionally, travellers to Australia have to be tested for COVID-19 within 72 hours of boarding their flight.
Speaking on the newly relaxed rules, New South Wales Premier Dominic Perrottet commented:
We know it has been a challenging time for international travel with new rules and the emergence of the Omicron variant, but this announcement is about simplifying the process and making sure Australia’s two biggest cities have a consistent approach.
New South Wales also upped the penalty for disregarding isolation, testing, and quarantine requirements. Noncompliance now risks fines of up to $5,000 for individuals and $10,000 for corporations.
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.