WEBVTT - BP Up, Lufthansa Down, Air France Down 

0:00:02.520 --> 0:00:07.360
<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News.

0:00:08.560 --> 0:00:12.440
<v Speaker 2>The Stock Movers Report, your roundup of companies making moves

0:00:12.480 --> 0:00:15.880
<v Speaker 2>in the stock market, harnessing the power of Bloomberg Data.

0:00:16.560 --> 0:00:18.279
<v Speaker 3>Let's take a look now at some of the stocks

0:00:18.280 --> 0:00:21.040
<v Speaker 3>on the move today in Europe. I'm Rachel Evans with

0:00:21.079 --> 0:00:24.640
<v Speaker 3>Caroline Hepka. We're joined with Bloomberg reporter Chloe Malay. Chloe,

0:00:24.640 --> 0:00:27.440
<v Speaker 3>thanks for coming. We had a rare primetime speech with

0:00:27.600 --> 0:00:30.840
<v Speaker 3>President Trump yesterday relating to the Iran war. How are

0:00:31.000 --> 0:00:33.840
<v Speaker 3>energy stocks reacting to that this morning? Likes of BP,

0:00:34.000 --> 0:00:35.000
<v Speaker 3>for example.

0:00:34.760 --> 0:00:37.200
<v Speaker 1>Yesterday there was some signaling from Trump that the war

0:00:37.320 --> 0:00:39.800
<v Speaker 1>might be coming to an end, and so that led

0:00:39.840 --> 0:00:42.640
<v Speaker 1>oil down and then oil majors down as well. But

0:00:42.680 --> 0:00:45.880
<v Speaker 1>then yesterday evening, in that primetime speech that you mentioned,

0:00:45.920 --> 0:00:48.600
<v Speaker 1>Trump at a very different tone, saying that the US

0:00:48.680 --> 0:00:51.479
<v Speaker 1>would hit Iran extremely hard over the next two to

0:00:51.600 --> 0:00:54.520
<v Speaker 1>three weeks. He did not present any sort of concrete

0:00:54.560 --> 0:00:57.680
<v Speaker 1>plan for exiting the war or also reopening at the

0:00:57.680 --> 0:01:00.319
<v Speaker 1>strait off of Hole Moves, which remains largely closed. So

0:01:00.680 --> 0:01:03.680
<v Speaker 1>the markets interpreted this as the fact that the resolution

0:01:03.760 --> 0:01:06.399
<v Speaker 1>to this conflict and might not come as easily or

0:01:06.640 --> 0:01:09.640
<v Speaker 1>as swiftly as we thought yesterday, and so we saw

0:01:10.040 --> 0:01:12.920
<v Speaker 1>oil jumping once again and then leading those oil majors

0:01:13.200 --> 0:01:16.640
<v Speaker 1>higher once again this morning. So we might see more

0:01:16.640 --> 0:01:19.440
<v Speaker 1>of this back and forth with oil jumping and retreating

0:01:19.959 --> 0:01:22.600
<v Speaker 1>as the market is try and really figure out how

0:01:22.640 --> 0:01:25.720
<v Speaker 1>and when exactly this war might end. But in the meantime,

0:01:25.760 --> 0:01:27.639
<v Speaker 1>BP is definitely in the green this morning.

0:01:27.840 --> 0:01:28.800
<v Speaker 3>Yeah. Absolutely.

0:01:29.480 --> 0:01:32.840
<v Speaker 1>Let's think about what it means for the airline business.

0:01:32.840 --> 0:01:35.440
<v Speaker 3>We had some news out of LIFTANSA today.

0:01:35.720 --> 0:01:38.440
<v Speaker 1>Yeah, so there was a big rally yesterday among those

0:01:38.720 --> 0:01:41.560
<v Speaker 1>European airlines because oil was falling, so it was all

0:01:41.560 --> 0:01:44.240
<v Speaker 1>part of this same story. Really. There was a sense

0:01:44.280 --> 0:01:47.920
<v Speaker 1>of relief from airlines that had dealt with those flight disruptions,

0:01:47.960 --> 0:01:51.440
<v Speaker 1>those higher fuel costs, and so they reacted quite positively

0:01:51.520 --> 0:01:54.080
<v Speaker 1>to the news that the war might come to an end.

0:01:54.080 --> 0:01:57.040
<v Speaker 1>But then today, as mentioned, we have oil jumping again

0:01:57.080 --> 0:02:00.640
<v Speaker 1>and therefore airlines down and so full liftans andticular. There's

0:02:00.680 --> 0:02:03.160
<v Speaker 1>also another thing that is really weighing on the stock

0:02:03.200 --> 0:02:06.600
<v Speaker 1>this morning, which is a downgrade from Morgan Stanley, with

0:02:06.720 --> 0:02:09.640
<v Speaker 1>analyst saying that there is a risk that fuel costs

0:02:09.639 --> 0:02:12.800
<v Speaker 1>could stay higher for longer and that Luftans is particularly

0:02:12.880 --> 0:02:15.560
<v Speaker 1>vulnerable to that. They said that even with a de

0:02:15.800 --> 0:02:18.760
<v Speaker 1>escalation in the coming weeks, there would still be some

0:02:18.840 --> 0:02:23.800
<v Speaker 1>refining capacity constraints, some constraints around logistics, around inventories, and

0:02:23.880 --> 0:02:27.040
<v Speaker 1>that means that a shortage of jet fuel is harder

0:02:27.080 --> 0:02:30.480
<v Speaker 1>and slower to resolve, and therefore would mean fuel costs

0:02:31.120 --> 0:02:34.399
<v Speaker 1>of staying higher. And then a separate note from Blueberg

0:02:34.440 --> 0:02:37.880
<v Speaker 1>Intelligence this morning also mentioned the same thing. They said

0:02:37.919 --> 0:02:42.520
<v Speaker 1>that companies like Luftanza but also appears like AAG and

0:02:42.560 --> 0:02:45.600
<v Speaker 1>Air France and Ryanair do have fuel hedges and that

0:02:45.720 --> 0:02:49.359
<v Speaker 1>stabilizes prices to an extent, but then that doesn't secure

0:02:49.520 --> 0:02:53.040
<v Speaker 1>product delivery, and so that makes those airlines very vulnerable

0:02:53.080 --> 0:02:56.560
<v Speaker 1>to supply shocks and that could in turn curtail flying

0:02:56.639 --> 0:03:00.560
<v Speaker 1>as well. Sotander is definitely taking bit of a hit

0:03:00.600 --> 0:03:01.640
<v Speaker 1>this morning as a result.

0:03:02.120 --> 0:03:05.520
<v Speaker 3>Interesting it starts hitting people's holidays. Finally, we had some

0:03:05.600 --> 0:03:08.000
<v Speaker 3>news for Air France. How's the market reaction to that.

0:03:08.280 --> 0:03:10.520
<v Speaker 1>Yeah, so there's a different airline story this morning from

0:03:10.639 --> 0:03:13.760
<v Speaker 1>fuel costs. So, Air France submitted the first bid for

0:03:13.800 --> 0:03:17.160
<v Speaker 1>a stake in the Portuguese airline TAP, so that essentially

0:03:17.400 --> 0:03:20.640
<v Speaker 1>kicks off the race for that company after Air France,

0:03:20.960 --> 0:03:24.320
<v Speaker 1>but then also Liftans and IAG were all invited last

0:03:24.400 --> 0:03:28.760
<v Speaker 1>year to submit preliminary offers for that Portuguese airline. The

0:03:28.760 --> 0:03:31.640
<v Speaker 1>Portuguese government is planning to sell as much as a

0:03:31.680 --> 0:03:34.400
<v Speaker 1>forty nine point nine percent of the company, and it's

0:03:34.400 --> 0:03:36.760
<v Speaker 1>said that it needs to be part of a larger

0:03:36.800 --> 0:03:40.000
<v Speaker 1>groups that it can gain scale and really secure a

0:03:40.040 --> 0:03:43.200
<v Speaker 1>long term future. So now the government will start reviewing

0:03:43.240 --> 0:03:47.040
<v Speaker 1>some initial proposals and then the shortlisted bidders will have

0:03:47.200 --> 0:03:51.120
<v Speaker 1>ninety days after that to submit binding offers. So we

0:03:51.520 --> 0:03:54.960
<v Speaker 1>are going to be waiting for Liftans and IAG to

0:03:54.960 --> 0:03:57.800
<v Speaker 1>potentially also submit some of those non binding offers to

0:03:57.800 --> 0:04:00.520
<v Speaker 1>start with. But Air France shares were a little bit

0:04:00.560 --> 0:04:02.760
<v Speaker 1>weaker this morning, although they might have more to do

0:04:02.840 --> 0:04:05.360
<v Speaker 1>with the oil story that we were mentioning rather than

0:04:05.600 --> 0:04:06.520
<v Speaker 1>this potential m and A.

0:04:06.640 --> 0:04:11.920
<v Speaker 2>Then the Stockmovers Report from Bloomberg Radio. Check back with

0:04:12.040 --> 0:04:14.600
<v Speaker 2>us throughout the day for the latest roundup of companies

0:04:14.680 --> 0:04:17.760
<v Speaker 2>making news on Wall Street and for the latest market

0:04:17.800 --> 0:04:22.279
<v Speaker 2>moving headlines. Listen to Bloomberg Radio Live, catch us on YouTube,

0:04:22.360 --> 0:04:25.839
<v Speaker 2>Bloomberg dot com, and on Applecarplay and Android Auto with

0:04:25.920 --> 0:04:27.400
<v Speaker 2>the Bloomberg Business app,