By the end of trading yesterday afternoon, Qantas planes were just starting to takeoff across Australia for the first time in just under two days.
The return to normal operations followed the Fair Work Australia tribunal order that the national carrier put its planes back into the air and the unions end industrial action.
That ended the grounding of the airline’s fleet which started at 5 pm on Saturday and the news had a positive impact on Qantas, Virgin Blue and other travel-related stocks.
The return to operations order saw the Qantas shares bounce more than 7%, to a day’s high of $1.66 before they settled back in a late market wide sell down.
The shares closed at $1.612, up 6.7c on the day.
It was hard to see if the temporary resolution of the situation boosted the shares, or support from investors generally.
Virgin Australia shares soared as much as 3 cents or 8.3% to 39 cents, but closed up 4% or 1.5c at 37.5c.
Other travel sensitive stocks weren’t impacted: Flight Centre, the big travel agent and Qantas’ biggest customer, saw its shares finish 9c higher at $19.88, while Webjet, the big online travel operator saw no change in the value of its shares on the day. They ended steady on $2.41.
Planes started taking off from Perth, Brisbane and Sydney just after 4 pm, two hours behind the original estimate from the airline.
Later reports said planes were would be leaving overseas airports for Australia during last night.
What many of the letter writers and noisy moaners on radio and TV yesterday failed to notice or mention that Qantas got strong support at Friday’s AGM from shareholders.
More than 96% of shareholders who voted supported the remuneration report, which is now the most contentious part of an AGM (As opposed to the large ‘against’ or no votes registered at the Pac Brands and the Crown Ltd AGMs earlier in the week).
So, while there was a bit of relief in the way the airline’s share price rose, there looks like there was also solid support for the airline from investors who want to see the airline take control of its future and are backing the hard line against the unions.
There was more argy bargy from the unions and Qantas about the rightness of their positions yesterday and overnight in the media.
But for now the situation seems to have cooled and investors can now concentrate on the RBA board meeting and interest rate decision later today, and, of course, the Melbourne Cup.
The RBA decision comes out at 2.30 pm and the Cup is run half an hour later.
Bloomberg said yesterday that 16 of the 27 economists surveyed by Bloomberg News forecast borrowing costs will be lowered.
The others saw no change.
The local market surged more than 50 points in early trading, helped by the positive news of the return to work order, then was sold off and lost more than 55 points or 1.1%, with much of that coming in the last half hour.
We can’t give you a winner for the Cup, but suggest you look at the form At First Sight, but don’t forget to ask the Jukebox Jury if Ilo remembers Americain’s win last year.
Last year’s win by Americain came on a day when rates last went up. Is that an omen or a warning?
