* EasyJet to follow Tui travel into Britain’s top index
* Wood Group to drop out as energy services sector struggles
* LSE could replace Serco if it can hang on to 90th spot
* Thomas Cook surges 130 percent into probable mid-cap berth
By Alistair Smout
LONDON, March 4 (Reuters) - Airline easyJet is set to join the UK’s leading share index for the first time and small cap tour operator Thomas Cook the mid-cap index as the tourism sector rebounds from tough trading conditions.
easyJet would follow in the footsteps of sector peer Tui Travel, promoted to the FTSE 100 in December, and replace energy services firm John Wood Group.
The airline has risen 37.6 percent since the FTSE’s last rejig, in December, buoyed by rising passenger traffic and a strategy to boost revenue by offering extra services, with good demand for flights from London.
The imminent promotion reflects demand from leisure and business passengers in the UK to travel abroad, which had been muted after the economic downturn, analysts said.
The surge in easyJet’s shares has made it the 82nd biggest company in the UK by market capitalisation, overtaking Tui Travel, which was added at the last reshuffle.
Promotion to the FTSE 100 would further increase demand for 2.5 million easyJet shares from those funds who passively track the performance of the index, Citi analysts said.
Also set to join the FTSE 100, the London Stock Exchange has risen 37 percent as trading volumes climbed and ranks 90th by market cap, qualifying it for automatic promotion.
If successful, the former blue chip -- evicted from the top list in June 2010 as trading volumes declined -- would probably see demand for 1.8 million extra shares from index trackers, Citi said.
John Wood Group -- set to leave the FTSE 100 after dropping to 112th place by market capitalisation -- reflects weakness in the energy services sector.
Any blue chip that closes at 111th place or below on Tuesday evening automatically drops out of the FTSE 100, and if Wood Group is demoted, index trackers could look to sell 3.6 million shares of the group’s shares, Citi said.
Only re-admitted into the top tier in September, Wood Group has underperformed in line with the rest of the sector and is down 1.8 percent since the last reshuffle.
The stock was hit by a poor 2013 outlook, echoing falls for peers Saipem and Petrofac.
Mid-cap outperformance has also brought outsourcing firm Serco to the cusp of a FTSE 100 exit. It is 110th in the market cap list despite rising 6.4 percent since the last rejig.
While not in line for automatic relegation, it would be demoted to make way for the LSE as things stand.
A Serco demotion would likely see the 2.5 million shares demanded by trackers of the FTSE 250 heavily outweighed by the 7.5 million looking to be sold by FTSE 100 trackers, Citi said.
Serco, which makes around a fifth of its sales in the United States, has been hit by concern about potential outsourcing cuts there as well as slow growth in the UK.
Serco and John Wood Group both report results on Tuesday, so may be saved if their shares get a big enough lift.
Mirroring the success of easyJet in gaining index promotion, Thomas Cook is in line to join the FTSE 250 after it surged 130 percent since the last shake-up.
The firm cut its quarterly operating loss last month. It said its turnaround plan was on track and that it had seen stronger operating performances in its major markets including the UK.
Also in line for an upgrade are online betting firm 888 Holdings and NMC Health, while Stobart Group , JD Sports and Raven Russia could lose mid-cap status.