Coronavirus: EasyJet falls out of the FTSE 100 after outbreak hits its market value

EasyJet has fallen out of the blue-chip FTSE 100 index after its market value was hit by the coronavirus outbreak.

The airline has lost nearly 45% of its value this year, while cruise operator Carnival is down more than 67% - both suffering from a massive fall in demand for travel during the pandemic.

FTSE Russell, the global index provider, confirmed both companies would be relegated to the FTSE 250, along with British Gas owner Centrica and engineering company Meggitt.

They make way for computer software company Avast, gambling company GVC Holdings, emergency repairs business Homeserve, and retailer Kingfisher.

The changes will be implemented at the close of business on Friday 19 June and take effect from the start of trading on Monday 22 June.

On Tuesday, when it looked likely that easyJet would exit the top index, Russ Mould, investment director at AJ Bell, had said the airline could make a comeback later in the year.

He said: "EasyJet would need a big rally, but it could come back in September (when the next reshuffle is due).

"With airlines, anything is possible."

On Tuesday, easyJet announced it will run 75% of its routes by August.

Both easyJet and Carnival declined to comment on their relegations.

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The news came as UK shares closed at three-month highs, following encouraging data from the world's two largest economies - the US and China.

The FTSE 100 and FTSE 250 both added about 2.6% on Wednesday.

Airline stocks were even able to shrug off concerns about the UK government's planned quarantine for arriving air passengers - easyJet finished up 8.2%, Ryanair gained 5.9%, Wizz Air climbed by 5.4% and British Airways owner IAG was up 11.4%.

Michael Baker, analyst at ETX Capital, said: "The economy's slowly coming back into production.

"It seems like we may have a much quicker recovery than what was anticipated before.

"We're breaking key levels, and we're still a little bit further and farther off from where we were, pre-pandemic. There's aggressive buying on the high."

This week until Thursday, Dermot Murnaghan will be hosting After the Pandemic: Our New World - a series of special live programmes about what our world will be like once the pandemic is over.

We'll be joined by some of the biggest names from the worlds of culture, politics, economics, science and technology. If you'd like to be in our virtual audience - from your own home - and put questions to the experts, email afterthepandemic@sky.uk