If there’s one thing investors can be sure of in today’s market, it’s uncertainty. The stock market surged back into bear territory this week as investors applauded the Fed’s “whatever it takes” attitude and oil prices started to recover. But the novel coronavirus remains the most important market driver, and it’s still unclear exactly where it will take the U.S. economy.
“The big unanswered financial question from this crisis revolves around which changes are temporary and which are permanent,” wrote Nathan Mauck, Ph.D., associate professor of Finance at the Henry W. Bloch School of Management, University of Missouri — Kansas City, in an email to InvestorPlace. “I don’t have any answers, but I could see a couple likely scenarios. One possible outcome is that we attempt to get back to business as usual as quickly as possible and are generally successful albeit slower than we’d like and with a few permanent disruptions. In this scenario, previous trends would generally continue on their pre-crisis trajectory with an overall delayed timeline. Another possible outcome is that we see more widespread disruption. This may potentially harm some existing firms/industries but also help major innovators over the medium and long-term.”
Either way, signs that coronavirus cases are starting to peak have sent encouraging signals to investors hoping the economy will be up and running in May. Even if the virus is under control by then, one thing is clear: coronavirus will have a lasting impact on the way we do business. From technological advances to business models, the world after Covid-19 is likely to look very different when we all emerge from lockdown.
With that in mind, here’s a look at some of the stocks and industries that will be forever changed by the coronavirus pandemic.
Travel and Hospitality Industries
One of the lasting impacts that coronavirus is likely to have will fall squarely on the transportation and hospitality industries. That’s because in the absence of a usable vaccine, people probably are likely to remain hesitant of any scenario that puts them into crowded spaces. Airlines in particular are likely to feel the impact of this shift in culture as people take fewer discretionary flights.
Former FDA chief Scott Gottlieb said as much in an interview with CNBC. He pointed to changing behavior among “marginal” consumers who won’t book as many flights or hotels as they used to because of the coronavirus risk.
A certain percentage of the population is going to be more circumspect about crowding into tight spaces indoors. The idea that things are going to snap back, we’re going to forget about this […] that’s not the case, this is going to be with us.
We’ve already seen unease within that sector as major hotel chains like Hilton (NYSE:HLT) conduct mass layoffs and airlines like International Consolidated Airways Group’s (NYSE:IAG) British Airways furlough huge proportions of their staff.
Medical Services Shift
The coronavirus pandemic has exposed the cracks in the world’s healthcare systems. As a result, major overhauls can be expected in the months following Covid-19’s containment. However, there are some immediate changes to the way people access healthcare that are already materializing.
Laura Gonzalez, an associate professor of Finance at California State University in Long Beach, believes tech will be a huge driver in the healthcare space moving forward.
“Artificial intelligence is needed more than ever in all industries to help continue operations, and supplement human workforce when sick or unable to be physically present,” said Gonzalez. “This is particularly important in saturated health services.”
That shift toward automation is already taking shape at leading tech firms specializing in AI. Microsoft (NASDAQ:MSFT) Chief Technology Officer Kevin Scott says the pandemic will likely spark a wave of investment in applying AI to medical science.
Microsoft has already been working to use its AI capabilities to better understand how the immune system responds to certain diseases. The company has been partnering with Adaptive Biotechnologies to create a Covid-19 test.
For now, the ‘all hands on deck’ mentality has anyone and everyone working on a coronavirus-related project, but in the future we could see technology playing a much larger role in medicine.
The Rise of Remote
Another big lesson the coronavirus pandemic has taught people all over the world: working from home is possible. While for many companies, the shift toward home-based working was a painful one, for others, the introduction of remote technology like Zoom (NASDAQ:ZM) and Slack (NYSE:WORK) will allow for a larger shift that continues even when lockdown measures are lifted.
The widespread use of remote work tools will be a boon for a host of industries from collaboration tools to cloud computing platforms.
But remote working isn’t the only category that will see continuing growth. A whole host of remote services the public may never have considered has shifted into view. Companies like Teledoc (NYSE:TDOC) that offer virtual healthcare options are having a moment in the sun that will likely continue well beyond the coronavirus pandemic.
Teledoc CEO Jason Gorevic said it best: “The demand has shifted forever on virtual care, and we’re on the verge of a new era for virtual care in the healthcare system.”
Not only do virtual doctors’ visits reduce the spread of infection, but they significantly lower healthcare costs. Teledoc says its services cut healthcare casts by 35%—something that will help boost its value in the aftermath of coronavirus as politicians resume the debate on how to lower healthcare costs.
Laura Hoy has a finance degree from Duquesne University and has been writing about financial markets for the past eight years. Her work can be seen in a variety of publications including InvestorPlace, Benzinga, Yahoo Finance and CCN. As of this writing, Laura Hoy did not hold a position in any of the aforementioned securities.