What to watch: Wizz Air cuts flights, West End owner woes, car production dives

Tom Belger
·Finance and policy reporter
·4 mins read
Wizz Air
Wizz Air cut flight capacity. Photo: Bernadett Szabo/Reuters

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world:

Wizz Air slashes flight schedule to 50% of capacity

The low-cost carrier Wizz Air has announced it has slashed its flight schedules, blaming increased travel restrictions in Europe.

The London-listed company’s (WIZZ.L) shares slid 1.5% in early trading on Friday, as it confirmed it now only expected flights to run at 50% of capacity compared to last year in October.

“Should the level of restrictions remain at the current level, Wizz Air anticipates not to operate at a higher level of capacity during winter than its projection for October,” it added in a trading update.

It had previously said at the start of September it expected capacity in the second and third quarters of the financial year to be 60%, down from initial expectations of 80% capacity by the third quarter.

“The protection of its solid balance sheet and excellent liquidity position as well as minimising cost across all areas of the business remain Wizz Air's top priority,” it said.

West End owner misses out on 59% of rent

West End property owner Shaftesbury has collected only 41% of tenants’ rent due up to 30 September, according to new figures.

The London-listed property investment trust (SHB.L) said 10% were expected to be deferred by agreement, 23% had been waived, and another 26% remained “outstanding.”

But the group, which leases restaurant and retail sites around Carnaby Street, Chinatown, Covent Garden, Soho and Fitzrovia, said most of its 611 restaurants, cafes, pubs and shops had now reopened.

"The course of the pandemic in the short and medium term will continue to dictate the extent of restrictions imposed by the UK and other governments to contain the spread of the COVID-19 virus, with implications for the global economy and the pace of recovery,” said Brian Bickell, its chief executive.

“As an international destination, local trading conditions in the West End will inevitably be affected by these macro uncertainties.”

UK car production drops 44.6% as firms sound no-deal Brexit warning

UK car production has fallen by 44.6% year-on-year in August due to the coronavirus pandemic and the country is set to lose billions of pounds and put millions of jobs at risk if Britain slips into a no-deal Brexit.

“The crisis of a second wave of coronavirus comes with the prospect of a ‘no-deal’ Brexit now mere months away and with the UK on course to produce just below 885,000 cars this year, down 34% on 2019,” said a Society of Motor Manufacturers and Traders (SMMT) report.

“The potential for this performance to rebound exists, but needs an ambitious, tariff-free FTA which could help car output return to pre-crisis levels of 1.2 million units by 2025.

“However, a ‘no-deal’ scenario would be disastrous, with car volumes potentially falling below 750,000 by 2025, hampering sector efforts to drive investment into the new skills, facilities and technologies that will be integral to delivering a zero-carbon future for the UK.”

Markets mixed as recovery fears offset US stimulus hopes

European stocks were mixed as markets opened on Friday, with hopes of fiscal stimulus, strong housing data and a tech rally in the US offset by fears over flagging economic recovery.

Britain’s FTSE 100 (^FTSE) gained 0.2% and Europe-wide Stoxx 600 (^Stoxx) gained 0.1%, but France’s CAC 40 (^FCHI) lost 0.5% and Germany’s DAX (^GDAXI) dropped 0.3%.

Concerns are rising over mounting infection rates and new restrictions in parts of Europe including France and Britain, and there was some disappointment UK government stimulus did not go further on Thursday.

But investors also welcomed more promising signs of government stimulus in the world’s largest economy, which had pushed up stocks in the US on Thursday. Democrats in the US House of Representatives are reported to be working on a $2.2tn (£1.8bn) stimulus package, with a potential vote next week.

Asian stocks were mixed overnight. Japan’s Nikkei (^N225) gained 0.5%, Hong Kong’s Hang Seng (^HSI) slid 0.3%, China’s Shanghai Composite (000001.SS) lost 0.1%, and the KOSPI (^KOSPI) in South Korea gained 0.3%.

What to expect in the US

Wall Street looked set to rise on the open after gains on Thursday. S&P 500 futures (ES=F) and Dow futures (YM=F) were 0.4% higher, and Nasdaq futures (NQ=F) were up 0.2% as European markets opened.

Watch: European markets set for worst week in three months