Thomas Cook -ed — What happened and where did it all go wrong?
Another one bites the dust. Poor old (literally, the company was founded in 1841!) Thomas Cook. Yet another tour operator/airline has gone bust and the fallout has been felt far and wide. In today’s weekly roundup, we take a quick look back at what happened to the UK-based, former air giant, and then a look forward at what you should have your eyes on this week. Let’s get to it!
The news of the world’s oldest travel firm going into liquidation was horrendous news for Thomas Cook staff. It was also pretty terrible for investors and the 600,000 customers that became stranded on holiday, leading to the largest peacetime repatriation effort in British history. Wow.
The company ran hotels, resorts and airlines for 19 million travelers a year, from within 16 countries, generating a tasty 2018 revenue of £9.6 billion GBP. Happy days.
So, where did it all go wrong for Thomas Cook?
Well, the company was in debt to the tune of £1.7 billion pounds, so the writing had been on the wall for some time. This debt seemed to hamper the company and render it ineffective amid stiff competition in the sector. Market share looked a little shaky as a result.
Already struggling to attract a new generation of tourists, the company faced frequent blows to its ability to maintain its existing customer base, too. For example, the 2016 coup attempt in one of its top destinations — Turkey, and the Europe-wide heatwave in 2018, which encouraged a lot of Brits to ‘stay-cation.’
How does the market look?
The collapse could provide a boost to Thomas Cook’s main rival TUI (TUIGn.DE), whose shares surged more than 10% last week. It may also bring a boost to other companies in Europe’s pretty crowded airline sector.
Important stuff for your diary this week
Trading and investing is far from an easy game. You need to be careful, do your research and then when you’ve finished that, get back out there and do a load more. Quite honestly, you can never know too much when making trading decisions.
That said, finding the information that can help you make reasoned trading decisions can be really, really hard. So, let’s take that hard out of the equation and give you some pointers on some of the events that might cause volatility over the coming week. Here goes…
● First up this week will be the release of the UK’s GDP QoQ for Q2, later today. We don’t need to tell you how important GDP is to a national economy. It’s about as key a signifier of economic health as you can get. GBP traders, eyes front!
● Tuesday could be a busy one. First up is the RBA Rate Statement — g’day AUD aficionados!
Next, we’re zipping to Europe for the release of the EU’s YoY Consumer Price Index — you know, the one that measures the comparative price of a standard shopping basket of goods. Important update for EUR traders.
Our whirlwind Tuesday tour finishes off with the US’ ISM Manufacturing PMI
● Wednesday — chill your beans, put your feet up, relax! Nothing major going on today. Actually, it’s a good time for an important note — make sure you do take regular breaks from trading. You can’t be full tilt, 100% on it all the time. Go out for a coffee, take a breather and leave the superhero stuff to Peter Parker. 🕷
● We’re back to biz on Thursday for the US’ Non-Manufacturing PMI variant…
● …before closing the week Stateside, with two biggies: the YoY Average Hourly Earnings and the Non-Farm Payroll report, which we always look forward to with bated breath!
So, busy week. Plenty of room for potential volatility there. Do some more research and get ready for the week ahead.
That’s all we’ve got time for today, but we’ll be back next week for another installment. If you can’t wait that long and you’d rather get your hands on some tailored content for your traders or investors — get in touch with us today.
The Contentworks Team