Thomas Cook shares soar but bonds hit record low
UK travel group rises 45% from the six-year low on Tuesday as traders say fears that the group will need to carry out fundraising had receded
Thomas Cook’s shares climbed 45% on hopes that it would not need to issue new equity, although its bond prices extended their losses to record lows on Wednesday, amid deepening worries about the UK travel group’s debt. The holiday and airline group has been under pressure since late November when it cut its profit guidance and suspended its dividend, halving the value of its shares in just over a week. The company was burned by the hot summer in northern Europe, which reduced demand for travel to southern European resorts. The stock recovered some losses on Wednesday morning to trade at 32.7p, which at midday was up 45% from the six-year low hit on Tuesday. Some traders said that fears that Thomas Cook would need to carry out a fundraising had receded, boosting the stock, although others disagreed, calling Wednesday’s rise a “dead cat bounce, most probably". Jefferies analysts said in a note on Wednesday that they did not expect Thomas Cook to need new equity. “Although we acknowled...
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