The FTSE 100 and pound took a nose-dive this morning as the final Covid restrictions in the UK were lifted.
The blue-chip index was down 2.13% at 6,859.15, while the pound hit a three-month low against the dollar, fuelled by concerns over rising Covid case numbers.
International Airlines Group, the owner of British Airways lost 4% in the first few hours of trading as the changing travel rules fuelled uncertainty among travellers.
AJ Bell investment director Russ Mould (pictured) said: “Many of the stocks leading the UK stock market downwards are related to travel and leisure, suggesting that investors are extremely worried that we’ve lifted restrictions too soon and that another lockdown could be a month or two round the corner.
“Covid is spreading fast again and the airlines, restaurants and leisure companies may not get the strong summer trading they’ve long hoped for. The fact Cineworld is down 8%, Carnival falling 7% and Restaurant Group 4% implies that investors think the reopening trade is now a dud.”
The much anticipated ‘Freedom Day’ saw most of the restrictions removed, including the wearing of masks and social distancing measures.
Self-isolation rules, however, remain in place for those contacted by NHS track and trace until mid-August.
Mould added: “Lots of people have been vaccinated and assumed they had become invincible. Reality is now striking as many of these individuals get a wake-up call by catching Covid or being pinged and told to isolate.
“The big concern for the market is whether we going to see a slowdown in the global economic recovery, and this could be the overriding force which results in a bad period for equities in the weeks ahead.”
