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On this news, along with continued momentum from Thursday's big news that the Food and Drug Administration had approved a 15-minute COVID-19 test costing $5, investors continued to buy shares of companies seen as being big beneficiaries of fast, cheap testing. These include cruise stocks, airline stocks, and casino and hotel stocks. Leading the charge today was Carnival (NYSE:CCL) with shares up almost 7%; along with Wynn Resorts and Alaska Air, up nearly 6%; and MGM Resorts International (NYSE:MGM) and Marriott International (NASDAQ:MAR), up more than 4%.
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Add in the prospects of a rapid, cheap coronavirus test that doesn't have to go to a lab to be processed, and investors are piling into businesses that have seen their biggest downturns since March, but could see big gains once they're able to return to business as usual.
Prospects for these businesses may not be as rosy as investors expect, however. MGM just announced that it was laying off 18,000 workers, while United Airlines Holdings, American Airlines Group, and Delta could cut well over 50,000 workers combined, barring federal aid that requires them to keep those employees on payroll. Air traffic is still down some 70%, and the airlines are bleeding cash.
The case is the same for cruise companies, where it's even worse since the entire industry remains under a "no sail" order in the U.S. from the Centers for Disease Control that's unlikely to be lifted anytime soon.
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