The CDC stated on Wednesday that restrictions put on the industry last year to stop the spread of the pandemic will stay in effect until Nov. 1. The comment comes just moments after a trade group representing the industry called on the CDC to withdraw restrictions and allow a step-by-step resumption of business starting in July.
Investors seem to have believed the CDC would grant the industry’s request, and that anticipation sent stocks of Norwegian Cruises (NCLH), Carnival (CCL) and Royal Caribbean (RCL) higher by more than 5% on Wednesday. But the stocks quickly reversed after the CDC’s response was made public.
It seems like the industry has a good argument to make. Other travel stocks have rallied as vaccine rollouts have increased, and President Biden has said he expects that by July 4 we will see conditions normalize in the country.
“The cruise industry has taken up a high threshold for resuming business with a multi-layered group of policies that is meant to be changed as conditions improve,” Kelly Craighead, president of the Cruise Lines International Association, explained in a comment published before the CDC’s decision. “Cruise lines should be treated like other tourism, entertainment and travel sectors.”
The CDC has said that passengers of cruise ships “are at greater risk of infectious diseases, including COVID-19, and outbreaks of the virus have been seen on cruise ships.”
Author: Scott Dowdy