This post was originally published on this site
Shares of Carnival Corp. rallied Tuesday toward a six week high, as investors shrugged off concerns of what the recent spike in COVID-19 cases to the highest daily rates in nearly a year might mean for the cruise industry.
Carnival’s stock
CCL,
rose 1.7% in midday trading, enough to make it the sixth-biggest gainer among S&P 500 index
SPX,
components. The stock was on track to close at the highest level since Nov. 17.
Meanwhile, 543.415 new cases of COVID-19 were recorded on Monday, to lift the seven-day average of cases to 243,099, the most since Jan. 13, and nearly triple the Nov. 15 daily average of 83,632. Read MarketWatch’s “Coronavirus Update” column.
On Monday, the stock had dropped 1.2%, as more ships reporting positive COVID-19 tests led to reports of more disgruntled passengers.
Carnival’s stock rally comes even as the Centers for Disease Control and Prevention said 25 of the company’s cruise ships has reached “yellow” status as of Dec. 27, which indicates reported cases of COVID-19 have met the threshold for investigation. Four other Carnival cruise ships have been flagged as “orange,” which means reported COVID-19 cases are still below the threshold for CDC investigation but are enough to require CDC monitoring.
Meanwhile, only 11 of Carnival’s ships were marked “green,” which indicates they have had no reported cases of COVID-19.
That compares with Royal Caribbean Group
RCL,
which has 20 ships flagged as “yellow,” 2 marked “orange” and 11 marked “green.” Norwegian Cruise Line Holdings Ltd.
NCLH,
has 12 ships marked “yellow,” one marked “orange” and six marked “green.”
Shares of both Royal Caribbean edged up 0.3% and Norwegian tacked on 0.2%, but were still below last week’s closing highs.
What may be helping assuage investor concerns over the possible impact of the surge in COVID cases, the CDC said late Monday that it was cutting the recommended isolation time for people who have tested positive for COVID-19 in half, to five days, if they are free of symptoms.
The CDC also said those have received a booster shot before being coming in close contact with a person who tested positive can avoid quarantining if they adhere to strict mask use for 10 days.
Over the past three months, shares of Carnival have dropped 18.6%, Royal Caribbean have tumbled 20.6% and Norwegian have slid 14.4%, while the S&P 500 index has gained 10.1%.
