Tuesday's Market Minute: Cruise Liners' Long Road To Recovery

Tourism stocks were up in premarket trading Tuesday following a day of gains Monday. Despite COVID-19 continuing to weigh on travel-related industries, several names saw relative strength after President Trump signed an executive order extending Coronavirus relief efforts. Royal Caribbean Cruises Ltd’s RCL CEO said the company is continuing to see a return to business, at least initially, after releasing its 2Q earnings.

Royal Caribbean is the second-largest of the three major U.S. cruise liners and announced they do not plan to relaunch most cruises until Oct. 31, 2020. All Royal Caribbean’s cruises had been canceled during its second-quarter following a forced shut down in March. However, the CEO remains positive on the company’s return-to-service, whenever that may be. He said, "We will see differences, but I think it will all be part of the evolutionary state of cruising… Just as flying is different now after 9/11, cruising will be different after COVID-19. But it will still be cruising." Part of Carnival Corporation, P&O Cruises, announced in a release Tuesday it will extend its pause in operations until Nov. 12. P&O Cruises also stated it will cancel two of its long itineraries due to depart in January of 2021.

The company president said in a statement, "It is clear that whilst the guidance is in place, it is not advisable for us to resume operations. Guests booked on the canceled cruises will automatically receive an enhanced 125% Future Cruise Credit or alternatively can fill in the website form for a 100% refund." Royal Caribbean shares are up about 17% so far this month, along with Norwegian Cruise Lines and Carnival both up over 10% and 11%, respectively.

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