Cruise stocks are sailing ahead today. This is likely due to news that the Centers for Disease Control and Prevention (CDC) ended its program to monitor Covid-19 risk levels for cruise ships in the U.S. Among the fast movers are Carnival (NYSE:CCL), Royal Caribbean Cruises (NYSE:RCL) and Norwegian Cruise Line (NYSE:NCLH) stocks.
These cruise ship operators, and their investors, are still struggling to revisit the calm waters of late 2019. Getting there won’t be easy as long as the CDC imposes constant monitoring and regulations. Now, however, there’s a sign that the regulatory agency is easing up on its oversight of U.S. cruise companies.
As of yesterday, the CDC’s Covid-19 Program for Cruise Ships was officially “no longer in effect.” The CDC will continue to offer guidance for cruise ships, however. Still, this event marks a transition to a greater level of trust that cruise ship operators can monitor themselves.
The transition isn’t entirely abrupt, as the CDC will “continue to publish guidance to help cruise ships continue to provide a safer and healthier environment for passengers, crew and communities going forward.”
What’s Happening With Cruise Stocks?
The impact of this development on well-known U.S. cruise stocks was powerful today. By 11:00 a.m. Eastern, CCL stock was up 5%, RCL stock rose 4% and NCLH stock climbed nearly 3%.
It certainly didn’t hurt that the broader stock market was surging this morning. Still, the CDC’s announcement clearly had Wall Street enthused about the U.S. cruise market’s future prospects.
Even beyond the transition to self-monitoring for cruise ship businesses, there are bigger-picture questions to consider. For example: Will Covid-19 testing requirements be dropped next? How about vaccine mandates? Also, will individual cruise lines ease their own requirements in the near future?
Of course, the current feeling of optimism could be dampened if Covid-19 spreads aggressively and/or if there are new variants. At least for today, though, investors in cruise stocks are apparently on a holiday from their worries.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.