What happened
Shares of cruise line stocks Carnival Corporation (CCL 2.30%) and Royal Caribbean (RCL 2.03%) both slumped in Friday trading, closing the day down 4.4% and 4.2%, respectively.
The jobs report -- and Delta -- seem to blame.
Image source: Getty Images.
So what
The U.S. Department of Labor reported today that the U.S. economy added only 235,000 jobs to its pandemic-wreaked rolls in August -- less than one-third of the 720,000 new jobs that economists had forecast. CNBC called the report "the worst since January," observing that "heightened fears of the pandemic and the impact [of] rising COVID cases" appear to be behind the sad numbers.
Now what
And investors can draw two conclusions from this: First, the delta variant of COVID-19 is acting as a drag on the economy. At the same time as it depresses jobs growth, it's likely that the continued spread of the virus is going to weigh on the minds of anyone considering getting into proximity with a lot of people -- for example, bottled up on a cruise ship for days at a time alongside thousands of strangers.
And second, the corollary to that is that the more COVID-19 depresses jobs growth, the fewer people will have jobs -- and disposable income -- to spend on cruises even if they are inclined to cruise.
In both respects, therefore, a weak jobs report bodes ill for the cruise industry. That's the fact that investors in cruise stocks seem to be responding to today.
