The Sydney Airport (ASX:SYD) share price slumped 5% today. Here’s why

The Sydney Airport Holdings (ASX: SYD) share price was diving today, in what seemed to be a reaction to news within the Federal Budget.

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Sydney Airport Holdings Pty Ltd (ASX: SYD) shares were diving today, in what seemed to be a reaction to news within the Federal Budget. By the market’s close, the Sydney Airport share price was trading 4.79% lower at $5.76.

In last night’s budget, the government revised the date by which it anticipates reopening Australia’s borders to non-essential travellers. It now doesn’t expect to see large numbers of international travellers coming or going from Australian airports until mid-2022.

This morning, Qantas Airways Limited (ASX: QAN) responded to the government’s projection by pushing back its plans to fly internationally from Australia.

Let’s take a closer look at the update to Australia’s projected international travel timeline.

International travel off the cards again 

Sydney Airport shares were in the red today after the government advised last night it doesn’t expect to see Australia’s borders substantially open to the rest of the world until the middle of 2022.

The government also extended its vaccination timeline, announcing the rollout will likely not be completed until the end of this year.

As mentioned, in response to the prediction that Australia’s international borders will largely stay shut for another year, Qantas was quick to push back its international flight schedule. Earlier this year, Qantas began selling tickets for international flights taking off as early as July 2021. But today, the airline advised the schedule will now be pushed out to late December 2021. This does, however, exclude trans-Tasman flights.

This also means the majority of usual international flights won’t be taking off from Sydney Airport any time soon.  

Sydney Airport share price snapshot

Last night’s news is yet another blow for the Sydney Airport share price, which has had a poor run on the ASX lately.

Currently, the airport’s shares are down by around 10% year to date. Although, they are still 4.75% higher than this time last year.

Sydney Airport has a market capitalisation of around $16.3 billion, with 2.7 billion shares outstanding.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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