It’s been a good week so far for REX’s stock despite the company releasing seemingly unfortunate news.
The post Why has the REX (ASX:REX) share price gained 6% so far this week? appeared first on The Motley Fool Australia. –
The Regional Express Holdings Ltd (ASX: REX) share price is having a great week despite the company’s planned take off being pushed back again.
The regional-focused Australian airline announced it had delayed its planned restart to flying for the second time on Monday. The delays are due to COVID-19 infections and lockdowns in Victoria and New South Wales, and REX’s need for “lead time” ahead of scheduled flights so as to sell tickets.
While the only recent news the market has heard from REX isn’t exactly positive, the company’s share price has been gaining.
At the time of writing, the REX share price is $1.49, 6.43% higher than it was at Friday’s close.
Let’s take a closer look at the news that might be boosting the airline’s share price this week.
The REX share price is soaring this week
The REX share price is taking off this week despite its fleet staying grounded.
REX announced that the suspension of its domestic services and reduction of regional services will continue until 31 October.
The airline’s planned resumption coincides with when it expects its front-facing staff to be fully vaccinated against COVID-19.
While this week’s news from REX seems unfortunate, the company’s share price is soaring.
The travel sector’s boost might be due to good news from the federal, New South Wales, and Victorian governments.
Over the weekend, Prime Minister Scott Morrison told Channel 7 there’s no reason states shouldn’t open their borders once 80% of the country’s population is fully vaccinated.
As of yesterday evening, 76.7% of Australians have had one COVID-19 jab and 52.6% are fully vaccinated.
Additionally, vaccinated people in New South Wales and parts of Victoria are set to exit lockdown on 11 October. Travel between the 2 states is expected to restart on 5 November.
All the good news might have boosted the REX share price and that of its peers. However, it hasn’t been enough to get the regional airline’s shares back into the green.
REX’s stock has fallen 28% year to date. Though, it is 17% higher than it was this time last year.
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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 owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.