Hospitality, leisure stocks on the rise after Boris Johnson confirms April 12
Indoor venues such as non-essential retail, hairdressers and gyms as well as bars and restaurants with outdoor seating will resume trading next week
Hospitality and leisure stocks were on the rise after the Easter weekend following the Prime Minister’s speech on Monday evening.
Boris Johnson confirmed that indoor venues such as non-essential retail, hairdressers and gyms will be able to resume trading next week.
READ: Pubs hope for good April weather in anticipation of pent-up demand
Most outdoor settings and attractions can also reopen, including pubs and restaurants with outdoor tables, zoos, theme parks, drive-in cinemas and drive-in performances events.
Hospitality venues will not be required to serve a substantial meal alongside alcohol and will not have a curfew, unlike last year.
Retail landlord Plc (), cinema operator () and travel firm Carnival plc () all jumped 6% to 35.97p, 104.9p and 1,717.7p respectively.
Upper Crust owner (), added 4% to 398.7p, is expected to benefit from “a fair number of folks on furlough” returning to work this week, analysts at Shore Capital said, which should assist activity in the transport hubs of England.
In fact, bus operators () and plc () were up 5% to 331.5p and 95.55p respectively, while booking platform plc () rose 3% to 488.7p.
On-the-go food producer Greencore plc () and baker () are also estimated to receive an uplift in trading, according to the broker, with more people needing to feed themselves outside of the house.
Pubs, cafes and restaurants will be hoping for good weather while supermarkets are bracing themselves for lower sales, which will turn even sourer when compared to the spike in activity experience with the first lockdown a year ago.
But Shore Capital remain “sanguine” about the prospects and valuation opportunities for UK grocers, as they will sustain fewer covid-related costs and will factor in higher working capital when short shelf-life food demand builds over staples and fuel demand increases.
Non-essential retailers will be also looking forward to reopening their doors again, especially ’s () Primark since it doesn’t have an online platform so it hasn’t been able to make any sales in England for the past few months.
() and () may benefit from the collapse of competitors Arcadia, Debenhams and Edinburgh Woollen Mills, Shore Capital commented, although the question remains on whether such pace will lead to a shift in offline share or simply depress footfall.
“The re-opening of offline space again is likely to take a little bit of demand away from the online channel,” the broker said.
“Quite how this pans out remains to be seen, but we see the elevated demand from online grocery and non-food remaining in place, that is there will be an easing back of recently evidenced participation levels, but we do not see a return to the 7.5% and around 30% rates respectively from the pre-pandemic times (most recently 15% and over 60%).”
Online grocer () shed 2% to 2,055.5p while food delivery service NV () dipped 1% to 6,797.5p on Tuesday morning.
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