Travel stocks surge as new COVID cases decline and treatment updates raise hopes for demand rebound
- Travel stocks gained in Monday trading as investors found hopeful signs in falling COVID-19 case counts and fast-tracked virus treatments.
- The FDA issued emergency authorization for plasma to be used as a virus treatment. Separately, the Financial Times reported Sunday the Trump administration is mulling an emergency use authorization for AstraZeneca's experimental vaccine.
- Daily new cases in the US reached 34,567 on Sunday, the lowest level in more than two months and the ninth-straight day of new cases landing below 50,000.
- United Airlines and American Airlines both leaped as much as 10%. Carnival and Norwegian Cruise Line soared more than 10% at intraday highs.
- Visit the Business Insider homepage for more stories.
Travel stocks soared in Monday trading as positive updates to the world's battle against the coronavirus drove new calls for industry recovery.
Investors betting on travel activity to rebound saw a weekend full of optimistic news before trading began on Monday. The US Food and Drug Administration issued emergency authorization on Sunday for the use of convalescent plasma to treat COVID-19. The move comes after calls from President Donald Trump to expedite treatment approvals.
Separately, the Financial Times reported Sunday the administration is looking to fast-track AstraZeneca's experimental coronavirus vaccine with an emergency use authorization. Doing so would avoid various regulatory standards and potentially bring a vaccine to market before November's presidential election.
Airlines touched double-digit gains in the morning before retracing some of their climbs. United Airlines and American Airlines both rocketed more than 10% at intraday highs, while Delta Air Lines leaped as much as 9.3%.
Cruises similarly surged. Carnival soared 10.5% at intraday highs. Norwegian Cruise Line and Royal Caribbean jumped as much as 10.6% and 6%, respectively. In all, travel stocks were among the biggest winners in Monday trading.
The aforementioned names typically rally on news of a vaccine or treatment arriving sooner than expected. Yet recent case data suggests the names have an increasingly stable foundation to rest on.
The US reported 34,567 new coronavirus cases on Sunday, according to data from Johns Hopkins University. The reading is down from 44,572 on Saturday and is the lowest daily addition in more than two months. Daily new cases have landed below 50,000 for nine days straight.
Other markets rallied in part on hopes for near-term resumption of travel activity. Oil futures jumped, with West Texas Intermediate crude trading as much as 1.3% higher, to $42.89 per barrel.
Now read more markets coverage from Markets Insider and Business Insider:
80% of economists see a chance of a double-dip recession, survey shows
Hedge funds and mutual funds are split on the elite group of FAAMG stocks — and that's led to a big performance gap