British Airways owner International Consolidated Airlines Group (LSE:IAG) shares fell on Thursday morning but other travel companies, such as TUI AG (LSE:TUI), were higher on hopes of a rise in holidays this summer.
The latest data on airlines and other activity from the ONS showed that industry troubles have continued, with UK daily flights still at half of pre pandemic levels.
"Despite high hopes that mass vaccine roll outs would by now have propelled the airline industry upwards on a smooth ride of demand, the latest data shows that turbulence is continuing," said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.
Tour operator TUI was climbing on amid reports that it aims to double the number of customer taking holidays in Greece next year, exceeding pre-pandemic numbers, a sign of confidence in pent up demand translating into bookings.
Over the next one to two years, JPMorgan predicted a "multi-year recovery" for European airlines in a note this morning as it expects COVID-19 to "transition from pandemic to endemic status in many parts of the world", ie it will remain ever-present "but with a low impact on how we live".
In the near-term, as the new data shows, daily flying activity is "likely to remain volatile" and we do not expect the recovery in results or share prices to be linear".
JPMorgan downgraded IAG however to 'neutral' from 'buy' as it sees a faster recovery for short-haul carrier than long-haul such as BA and said "we think companies with stronger balance sheets will outperform those with weaker ones", which led to an upgrade for Ryanair Holdings PLC (LSE:RYA) to 'overweight' from 'neutral'.
Indeed, the Irish short-haul specialist is increasingly bullish about the near-term recovery, with Ryanair's Eddie Wilson talking of a "sea change" in confidence in an interview with Reuters.
He said: "I think people's mindset has moved as well in terms of 'I'm traveling', 'I'm going'. They can see the summer. They are not in the darkest days of where we were the previous year."
Elsewhere in the travel sector, the lifting of Plan B restrictions by the Prime Minister yesterday and the expectation that workers will head back to the office has also been met with a relief rally by Trainline PLC (LSE:TRN) today, following gains for the likes of National Express yesterday.
"The company has been severely hit by the exodus of commuters from the railways, and the expectation is that online bookings will start clicking back up, although given the hybrid working from home revolution, there is still a huge journey ahead to get close to pre-pandemic levels of business," said Streeter.
JPMorgan reiterated its 'overweight' rating on Wizz Air Holdings PLC (AIM:WIZZ).