Travel and leisure stocks saw a third straight day of declines as a second wave of coronavirus cases has emerged in the U.S. with the number of confirmed cases pushing past two million, according to data from John Hopkins University.
Airline stocks plunged Thursday, including declines of as much as 16% for Delta Air Lines Inc. and 14% for JetBlue Airways Corp. Hotels, cruise operators, online travel agencies and car rental stocks also traded sharply lower, along with restaurants, amusement park operators, casinos and boating stocks. It was essentially a sea of red in discretionary names.
The easing of stay-at-home orders across the global had sparked optimism that life was slowly returning to normal. There have been some industry-specific positive signals, as well, including airlines increasing capacity, amusement park and casinos reopening, and boating demand. The S&P Supercomposite Airlines Index has rebounded more than 50% from its May 15 low, while an index of hotel, restaurants, casinos and cruise stocks was up 11% for the same period compared to the S&P 500 Index’s gain of about 8.5%.
The second-wave scare is causing investors to seek shelter in stocks that have benefited from Americans staying closer to home. Netflix Inc., Zoom Video Communications Inc. and Peloton Interactive Inc. all traded higher Thursday despite the S&P 500 having its biggest drop since May 1.
This article was provided by Bloomberg News.