Cruise and other travel stocks keep climbing, with a little help from the Fed

By Tomi Kilgore The S&P 500's top two gainers Thursday were shares of cruise operators, and Expedia's stock closed at another record, as investors bet lower rates will inspire consumers to make travel plans Cruise stocks led the market higher Thursday, and shares of other travel companies also rallied, as the Fed's rate cut helped boost the prospects of consumers spending on vacations. Shares of cruise operators surged in sync again on Thursday, enough to stand out as market leaders, as investors bet that lower interest rates put consumers in a better position to plan shipboard vacations. But it's not only cruises, as shares of other travel companies also rallied for a second day in a row, after the Federal Reserve lowered its benchmark rate on Wednesday for the third straight meeting. "Lower rates typically provide a tailwind to travel stocks, and can help improve consumer sentiment," Gordon Haskett analyst Bobby Mollins wrote in emailed comments. Royal Caribbean Group shares (RCL) shot up 7.4% on Thursday after climbing 4.9% on Wednesday, and Norwegian Cruise Line Holdings' stock (NCLH) rallied 6.8% after tacking on 2.8% the day before. Those stocks were the S&P 500 index's SPX top two gainers. Carnival (CCL) jumped 5.9%, and was the S&P 500's fifth-biggest gainer, after rising 3% on Wednesday. Also providing fuel to Royal Caribbean's stock rally, the company announced on Wednesday a stock repurchase program for up to $2 billion, which doubles the prior $1 billion buyback program that had been completed. In another positive for the cruise industry, BofA Securities analyst Andrew Didora wrote in a Thursday note that credit- and debit-card data showed that spending on cruises "remains healthy," rising 11.2% in November from a year ago, and was up 10.2% from October. Elsewhere, shares of Expedia Group (EXPE), which lets users book a cruise or make other travel plans, jumped 2.5% on Thursday after running up 4.9% the day before to book its first record close in a month. Gordon Haskett's Mollins said besides just the lower-rate scenario, Expedia has moved to capitalize on the trend of consumers picking travel destinations based on what they see on screen, with its launch of a "Jet-Setting" booking hub. Among other travel stocks, Marriott International's (MAR) gained 3.3% on Thursday and Hilton Worldwide Holdings' (HLT) advanced 2.6%, after they tacked on 1.1% and 0.7%, respectively, on Wednesday. And the U.S. Global Jets ETF JETS was up 0.8% to its highest close since March 17, 2021. Individual airline stocks were on the mixed side, however, as American Airlines Group shares (AAL) fell 1.2% on Thursday but Delta Air Lines' stock (DAL) gained 0.9% and United Airlines Holdings shares (UAL) added 0.6%. -Tomi Kilgore This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal. (END) Dow Jones Newswires 12-11-25 1627ET