Airlines stocks started the week on the back foot as a surge in cases across Europe, alongside a slow vaccine rollout, is suggesting overseas holidays may not be on the cards for Britons this summer.

British Airways owner International Consolidated Airlines Group SA (LON:IAG), easyJet plc (LON:EZJ), TUI AG (LON:TUI) and Wizz Air Holdings plc (LON:WIZZ) were all trading lower on Monday at lunchtime.

Deutsche Bank downgraded IAG to ‘hold’ from ‘buy’ leaving the target price unchanged at 220p, noting that the stock has benefitted from increasing optimism over the vaccine rollout.

According to UBS, global travel restrictions remain high with restrictions on over 80% of global routes and now 85% of intra-EU routes.

“We think travel restrictions first need to show a material reduction before the path to recovery can begin but we think the booking window remains very short,” analysts noted.

“While demand should pick up from the second quarter of 2021 the economic backdrop is still challenged compared 2019. Furthermore, fuel costs are seeing upward pressure due to oil and carbon costs.”

France, Germany and Italy announced further lockdown measures over the weekend as a third wave of infections is sweeping across the Continent.

The bloc is also struggling with the vaccine rollout amid issues with AstraZeneca PLC (LON:AZN), with data from the Our World In Data website showing that only 13 out of 100 people in Europe have received the jab, compared to 44 in the UK.

Moreover, Westminster wants to keep out new COVID-19 variants so it may put a break on international travel to avoid returning residents to cause a resurgence of cases.

“I think that international travel this summer is, for the average holidaymaker, sadly I think, extremely unlikely,” Dr Mike Tildesley, a government adviser, told the BBC.

“I think we are running a real risk if we do start to have lots of people going overseas in July, for instance, and August because of the potential for bringing more of these new variants back into the country.”

“What is really dangerous is if we jeopardise our vaccination campaign by having these variants, where the vaccines don’t work as effectively, spreading more rapidly.”

Westminster is expected to announce new rules on international travel next month, while the roadmap out of lockdown indicates May 17 as a tentative date for people to go abroad.

UK residents can now leave the country for limited reasons and need to show proof of negative COVID-19 test on arrival, followed by ten days of quarantine and two further tests.

TUI slipped 6% to 375.1p, easyJet and IAG dropped 5% to 948.2p and 197.32p respectively while Wizz Air was down 2% to 4,816p on Monday in the early afternoon.

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