Belfast Telegraph

BA's IT meltdown drags market lower

The London market was dragged lower after shares in the owner of British Airways took a tumble following a "catastrophic" IT failure over the weekend.

The FTSE 100 Index was down 21.12 points to 7,526.51, with International Consolidated Airlines Group (IAG) enduring a rough ride in its first day of trading in London after customers were hit by flight cancellations and delays during bank holiday weekend.

The airline group was down by more than 1%, or 8.5p to 605.5p, as the company braced for a hefty compensation bill in the wake of the disruption.

Shares in IAG, which is also listed in Madrid, had already dropped heavily in trading in Spain on Monday, wiping around 410 million euro (£357 million) off the stock.

George Salmon, equity analyst at Hargreaves Lansdown, said: "BA may have confirmed that it is now running a full schedule of flights, but investors in IAG, BA's parent company, are counting the cost of a calamitous Bank Holiday weekend.

"While the costs of passenger compensation and refunds could well run into the tens of millions, the whole sorry episode has undeniably put a dent in BA's reputation for delivering a premium service, and the worry for shareholders is that this unquantifiable impact could have longer-term consequences."

Across Europe, Germany's Dax was down 0.2% and the Cac 40 in France fell by 0.5%.

On the currency markets, the pound was up 0.1% versus the US dollar at 1.284, as it recovered some ground following Friday's losses when an opinion poll showed the Conservatives advantage over Labour had narrowed to just five points.

A separate Guardian/ICM poll published on Tuesday gave further signs that the Conservative's lead might be waning, slipping two points to 45% with Labour on 33%.

However, sterling picked up against the greenback after worse-than-expected consumer confidence data in America pulled the US dollar lower.

In contrast, the pound was down 0.2% against the euro at 1.149.

The price of oil dropped 1.3% to 51.62 US dollars a barrel, with concerns persisting despite Opec's promise to extend output cuts to tackle oversupply in the market.

In UK stocks, the London Stock Exchange Group (LSEG) was among the biggest risers after inking a £535 million deal to buy an American analytics business.

The LSE swooped for the yield book, fixed income indices and world government bond index (WGBI) from US investment bank Citi, subject to regulatory approval.

The move will deliver cost savings of around 18 million US dollars (£14 million) and bolster assets under management at FTSE Russell to 15 trillion US dollars (£12 trillion).

Shares were up more than 1%, or 51p to 3,442p.

The biggest risers on the FTSE 100 Index were 3I Group up 20p to 888.5p, TUI up 23p to 1,192p, GlaxoSmithKline up 29.5p to 1,673p, London Stock Exchange Group up 51p to 3,442p.

The biggest fallers on the FTSE 100 Index were Mediclinic International down 26.5p to 789.5p, Shire down 148.5p to 4,503p, Informa down 19p to 669.5p, Old Mutual down 5.3p to 191.3p.