up up and away

Qantas shares soar

Qantas shares surged this morning on the merger news.

By 10.10am (AEDT) Qantas shares were up almost 9 per cent, or 20c, to $2.45, after falling 10c yesterday.

"It may be positive news for Qantas shares,'' CMC Markets Stockbroking general manager Andrew West said.

Mr West said a tie-up between the carriers would be a positive move for Qantas, particularly at a time where many airlines are facing tough market conditions and consolidation is on the cards.

"If the deal goes through it will create a formidable airline that has a major share of major routes to the US, UK and Asia,'' he said.

Although the airlines are in talks, Qantas said there's no guarantee a deal will go ahead.

Mergers and tie-ups are becoming more attractive to the aviation industry as airlines try to cut costs to cope with the global economic downturn.