Easyjet said it was already experiencing the effects of the Omicron variant as it released full year results in which it recorded a £1.1bn pre-tax loss.

Easyjet said it had been experiencing transfers of bookings for Q1 and a ‘softening’ of trading for the immediate future, but were optimistic for the rest of the year.

On a more positive note, Easyjet’s results were ahead of expectations and the balance sheet is robust.

COVID ravaged Easyjet’s ability to generate cash over the past year, leading to a focus on cost savings that helped keep cash burn to £36 million per week, below the expected £40 million.

“easyJet is moving through the pandemic with renewed strength having transformed the business by optimising our network and flexibility, delivering significant cost savings while also step-changing ancillary revenue,” said Johan Lundgren, easyJet Chief Executive.

Nonetheless, Easyjets cash saving drive was not enough to prevent a whopping £1.1 billion loss to add to £1.3 billion recorded last year.

Despite a dismal year for Easyjet, analysts were looking forward to next year and the potential for a bumper summer, assuming COVID is under control by then.

“While EasyJet’s £1.1 billion pre-tax loss makes for uncomfortable reading, that’s the stark reality of the airline industry at present. Capacity remains restrained as travel restrictions have prevented airline operators from truly being able to make the most of the post-lockdown pent-up demand from consumers to get outside and see the world again,” said AJ Bell investment director Russ Mould.

“The airline sector saw a flurry of activity this summer and then again during the October half term as travel restrictions began to ease and consumers felt more comfortable flying. A lot of people will have missed their usual summer foreign holiday for two years in a row so there is a feeling that summer 2022 could be a bumper period for companies like EasyJet.”

BT shares jumped on Monday following reports by the Economic Times Indian conglomerate Reliance Industries were lining up and offer for the London-Listed telecoms group.

The BT share price rose as high as 167.3p one Monday morning, before easing back as the session progressed.

BT showed signs of turning a corner earlier this month as they released half year results highlighting the impact of cost savings on profitability.

Adjusted earning per share rose 7% to 10.2p and adjusted profit after tax also rose 7% to £1,014m.

The jump in profitability came even though revenue rose just 1% to £10.3bn. It is these steady revenues that are the attraction to Reliance as BT is still dogged by pension liabilities.

Reliance have recently been outbid by a PE group for the Dutch T-Mobile unit and Reliance are reportedly eyeing BT’s Openreach roll out after BT ruling out a joint venture.

“It says something about the shifting dynamics of the global economy that an Indian firm like conglomerate Reliance Industries could be about to launch a bid for control of British telecoms giant BT,” said Russ Mould, investment director at AJ Bell.

“The reports come after a private equity bid for Telecom Italia which suggested the whole sector was in play.”

“Telecoms stocks have been as unloved as a cold caller on Christmas Day, and this is reflected in depressed valuations.”

“Reliance itself was outbid on a deal for control of a Dutch unit of T-Mobile as recently as September, and it may have rivals for its apparent interest in BT. French billionaire Patrik Drahi, the founder of Altice, has been steadily building up a position in BT and Deutsche Telekom already has a sizeable stake.

“It will be interesting in this context to see if this rumoured move by Reliance flushes out other parties and dials up a bidding war for BT.”

“You can understand why BT might attract interest. Despite its substantial pension liabilities and debts and iffy track record, it has a near monopoly position in the UK’s broadband network. And, for all its recent woes, BT has the capacity to generate substantial cash flows.”

European equities rebounded on Monday following panic-induced selling on Friday after the discovery of a new coronavirus variant Omnicron.

The FTSE 100 rose by 0.68% to 7,089 in early trade on Monday.

The German DAX was up 0.45% at 15,325 and the French CAC 0.9% higher.

“The anxiety attack on the financial markets shows signs of alleviating, as investors pause for breath and spot signs of optimism while scientists race to establish the severity of the new variant. The FTSE 100 opened up 1% in early trading, recovering some of Friday’s dramatic losses and the FTSE 250 was 1.5% higher,” said Susannah Streeter, senior investment and markets analyst Hargreaves Lansdown.

The rebound in markets can also be attributed to comments from South African doctors around how those infected with Omicron were reacting. Early reports suggest that Omicron isn’t more severe than Delta as first feared, although it will take time to properly assess patients on a large scale.

“There are reports from doctors in South Africa that Omicron infections don’t seem more severe and the World Health Organisation’s appeal for caution also appears to have calmed some nerves. It has observed that although there appears to be increasing rates of hospitalisation, that may be due to higher numbers being infected rather than due to its specific strain,” Streeter said.

BT shares

BT shares shot up over 8% on reports the telecoms company has got the attention of India’s Reliance Industries., who were contemplating an offer. The interest in BT comes shortly after a Private Equity approach for Telecom Italia suggesting we. are about to experience a wave of M&A throughout the telecoms sector.

BT led a broad rally in London-Listed shares on Monday with most industry sectors rising, particularly those with exposure to commodities and those heavily hit last Friday.

IAG added 3% after being destroyed on the Omicron news last week.

Polymetal was the FTSE 100’s biggest faller as investors reduced exposure to the safe haven of precious metals shares.