What happened

Tic-tac-toe, three in a row, shares of cruise line stocks Carnival Corporation (NYSE:CCL), Royal Caribbean (NYSE:RCL), and Norwegian Cruise Line Holdings (NYSE:NCLH) all jumped in Friday trading, rising 3.5%, 3.6%, and 4.6%, respectively, through 10:30 a.m. EDT.

And you can thank pharmaceutical giant Merck (NYSE:MRK) for that.

Three colorful arrows racing straight up on a black background

Image source: Getty Images.

So what

This morning, drugmaker Merck announced that its anti-Covid pill molnupiravir has proven effective at cutting the rate of hospitalization and death from Covid by "approximately 50%" in a Phase 3 clinical trial. And that's only the headline revelation. Read a little deeper into the report, and you'll learn that while a few patients involved in the trial were hospitalized, precisely zero patients treated with molnupiravir died over the 29 days of testing.  

Merck stock, by the way, is now up a hefty 9%.

Now what

True, in this trial molnupiravir was given only to "non-hospitalized adult patients with mild-to-moderate COVID-19," but if you are considering these data from the perspective of a potential cruise line customer, here's how things probably look:

If I get on a cruise and suddenly come down with a fever and, taking a test, discover that I've just contracted Covid and am in the early stages of the disease (i.e., still "mild-to-moderate" symptoms), then it sure sounds like Merck has a pill that can stop Covid in its tracks. It might even eliminate the risk of dying from Covid entirely.

Now, do you think that news like that might make you feel a bit more comfortable about signing up to take a "Carnival cruise" -- or a cruise with Royal Caribbean or Norwegian, for that matter? I think it might.

While Merck's pill isn't approved for general consumption yet, the fact that "Merck plans to submit an application for Emergency Use Authorization (EUA) to the U.S. FDA as soon as possible based on these findings" suggests that in the foreseeable future, cruise lines could finally see demand for their services return to something approaching normal once again.  

 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.