Airlines, cruise and resort stocks pile up on Covid-19 variant
Omicron is the name of the new variant of Covid-19 identified by the World Health Organization and new travel restrictions are already coming into force.
This news has now led to spectacular sales in the directly affected market sectors: airline, cruise and resort stocks have fallen in price and mostly stayed there.
United Airlines Daily Price Table, for example, now looks like this:
The stock fell quickly to its early 2021 low of 40 before rebounding. This red circle not only shows the area of space but also the sudden explosion higher in volume (in red). You can see how today’s lower prices knocked out the mid-September low. Today’s drop is a one-day loss of 9.69% for United Airlines shareholders.
American Airlines Daily Price Table Is similar:
The spread narrows on the heaviest volume from the end of March to today. Note that the price closed below the mid-July low and a mid-August low that followed. For a brief period earlier this month, American Airlines had closed above its 50- and 200-day moving averages, often seen as a bullish sign by price chart analysts – but not this time, apparently.
Cruise lines have also suffered from today’s news. The Daily Price Chart for Carnival Corp looks like this:
It’s pretty much the same pattern as airline stocks: big spread over big volume. The stock closes well below the mid-July low. Carnival had managed to break its 50- and 200-day moving averages in late September, but now it’s all essentially canceled.
here is Royal Caribbean Cruises Daily Price Table:
There is a huge gap on a much heavier volume than usual after the news. In this case, the stock managed to close above the mid-July low, albeit narrowly. Note that Royal Caribbean had a bullish tone in early November when it released the early June high above the 98 level.
A variant of Covid-19 likely also means fewer bookings for the resort industry and major industry actions have shown the effect.
Las Vegas Sands Daily Price Chart is here:
It’s a little different from the actions of airlines and cruises. This large casino complex lost more than 5% but managed to stay above previous lows in September. The sales volume is not as bad as it was back then. Las Vegas Sands appears to be consolidating in that 36-42 range – at least for now.
The WYNN Daily Price Table looks like this:
The stock retreated but remained above the September low. WYNN had consolidated above its 50-day moving average in recent weeks. The question now will be whether he will regain that momentum.
No investment advice. For educational purposes only. Always consult with a registered investment advisor before making a decision.