Shares of travel stocks mostly fell Wednesday, with TUI and Carnival two of the worst performers, down 4.39% and 2.96%, respectively.

Others such as IAG, EasyJet, and engine maker Rolls-Royce also fell following a report from Bloomberg that said Chinese tourists remain wary of travelling overseas.

IAG closed the session down 0.68%, EasyJet fell 1.59%, and Rolls-Royce declined 0.62%.

“On the eve of China’s May Labor Day holiday week, more than half of Chinese travelers say they haven’t set plans to go abroad this year,” Bloomberg’s Lebawit Lily Girma wrote.

Girma added that 31% have said no to international travel altogether, citing a survey shared with the publication.

The lifting of Chinese travel restrictions at the start of 2023 was expected to provide a substantial boost to the travel sector, with travellers from the country providing a significant source of traffic.

Bloomberg said that the return of travellers from the country is considered essential for the industry, with China the largest source of outbound tourists pre-pandemic, contributing $253 billion to the global economy in 2019.

The survey was conducted between April 4 and 7 in 49 cities, with 1,012 mainland Chinese travellers.

Respondents cited safety as one of the top things to consider when booking, while only 10% of people said they had outbound trips booked for 2023.

Elsewhere in the travel sector on Wednesday, Heathrow reported 16.9 million passengers in the first quarter, up 74.2% year-on-year. However, Heathrow has not yet returned to profit, with adjusted losses of £139 million in Q1.

The Heathrow CEO also urged the UK government to scrap the tourist tax.

By Sam Boughedda