European airline stocks already battered by the coronavirus have plunged again as a US travel ban on much of continental Europe deepened the sector's misery and piled pressure on governments to offer emergency support.
Shares in European carriers, some of which have fallen by more than half since the virus outbreak first halted flights to China, suffered further double-digit declines as markets opened on Thursday.
The 30-day US curbs on travel from the 26-country Schengen Area, which excludes Britain and Ireland, are similar to those that went into effect targeting China on February 1 and do not apply to US residents or their immediate family.
"The impact of the ban will be more substantial" for major European carriers than the earlier China flight suspensions, Bernstein analyst Daniel Roeska said because the North Atlantic accounts for a large share of their long-haul profits.
"The ban effectively stops travel from the Schengen Area to the USA."
Air France-KLM shares were down 15 percent, with Lufthansa and British Airways parent IAG almost 11 percent lower. Norwegian Air, which was struggling to avert a cash crunch even before the coronavirus crisis, was down 18 percent.
Lufthansa said it was assessing the impact of the changes on its US operations, while Air France KLM did not respond immediately to a request for comment.
The news also sent Asian airline shares sliding during the region's trading day, with analysts warning of a big impact.
It came as airlines, tourism and airport operators were already scrambling to respond to a global slump in travel that is increasingly likely to require government aid to tide companies through the crisis. The European Union will publish new state-aid guidelines on Friday.
ADP declined to comment on a Thursday report that it was preparing to close terminal 3 at Roissy Charles de Gaulle, the French capital's biggest airport.
Norway is considering whether to close down several airports as part of its efforts to curb the spread of the virus, airport operator Avinor told the public broadcaster NRK.
US President Donald Trump said the ban was needed because the country was entering a "critical time" in the fight against the virus, which has spread across the United States and killed at least 37 people and infected 1281 there.
US airlines had already cut flight schedules to Italy, facing the largest European outbreak, and will take another hit from lower demand for flights from major destinations such as France and Germany.
The move is set to decimate spending by European tourists in the United States. In March 2019, European visitors to the country accounted for 29 percent of arrivals and $US3.4 billion of spending, the US Travel Association said.
Reuters
