Featured # Markets | 4 years ago

Travel Industry Is Getting Sick Of The Zika Virus

Tourism stocks and travel related stocks have taken a hit after the latest wave of zika virus fears. Even though many moved higher Monday, most are still much lower as compared to the previous week.

The CDC said it has been able to confirm that 31 Americans have become infected, all of whom had traveled to one of 24 countries and territories with outbreaks identified. The Caribbean, South America, and Central America have been hit the hardest by the mosquito-borne virus. Several cruise lines based in the US along with airlines and hotels are located in these regions, which could be the source of the cases found in the U.S.

Some traction was gained against losses last week from travel related company stocks but are still relatively lower. Against the larger market, these stocks are also showing to be under performing. Wells Fargo Securities analyst Tim Conder stated, “Cruise line stocks have under performed the market by quite a bit — and so have travel group stocks in general because of concerns about Zika.”

The WHO anticipated that up to 4 million people in the Americas are at risk of getting infected by the zika virus, and the CDC is warning pregnant women in particular to consider postponing travel to the areas where the transmission of the virus is ongoing. The zika virus has been linked to microcephaly, a serious birth defect. In comparison to the Ebola outbreak that was previously seen as a growing epidemic, analysts are finding that zika may not be on the same scale due to the fact that it would appear zika appears to only be a primary risk to pregnant women.

Wells’ Conder stated to CNBC, “We’re not diminishing the seriousness of Zika or how it’s spreading, but if you compare it to Ebola the primary risk appears to be women who are pregnant. Ebola is a much more dire situation for anyone. Even if it does spread — and probably will — efforts being marshaled will help contain it.”


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