Qantas shares hit 2014 high

Shares in Qantas Airways have hit their highest point in 2014 as investors digest the national carrier's lessened focus on capacity.

At 11.20am (AEST), Qantas shares were 2.36% higher at $1.30, against a benchmark index lift of 0.35%.

In earlier trade, Qantas shares hit as high as $1.3075, their peak since October 28 last year when they traded at $1.315 and the highest point in calendar 2014.

The share price rise comes on the back of an interesting week, and a troubling year for the national carrier.

On Wednesday, Qantas announced it will add no new capacity in the first three months of the 2014-15 financial year, fueling speculation among commentators and analysts that the capacity war between Qantas and Virgin Australia was effectively over.

"With the new Virgin Australia directors from partners Air New Zealand, Singapore Airways and Etihad due onto the Virgin Australia board next month, we doubt whether Virgin Australia will respond aggressively to Qantas' olive branch," Macquarie analyst Sam Dobson said in a note to clients.

Earlier in May, Qantas said it expected to shed 2,200 jobs by the end of June as part of a restructure that will create $2 billion in gross savings by fiscal 2017.

Qantas told the Macquarie Australia Conference that it is targeting $800 million in cost savings by fiscal 2015 and is set to reduce ex-fuel spending by more than 10%, with positive free cash flow expected from fiscal 2015 onwards.

The airline announced in February that it would cut 5,000 jobs after swinging to a first-half net loss.