What happened

Shares of Carnival (CCL -5.56%) (CUK -5.76%), the world's largest cruise line operator, moved higher last month. The company rebounded from a disappointing earnings report at the end of September, and macro-level news seemed to lift the battered travel stock.

It was a good month for stocks in general; the S&P 500 finished October up 8%. This could have been based on hopes of a "Fed pivot" -- that the Federal Reserve would soon begin reeling in its interest-rate hikes, relieving a key headwind on the stock.

Even in a normal environment, Carnival is sensitive to the macroeconomic climate: Travel, especially on cruise lines, is discretionary. And the stock is even more vulnerable while the business tries to stabilize itself as the pandemic eases. Carnival is a high-beta stock, meaning it tends to be more volatile than the broader market. According to data from S&P Global Market Intelligence, the stock finished the month up 29%.

The chart below shows how the stock tracked like a more volatile version of the S&P 500 over the course of the month:

CCL Chart

CCL data by YCharts

So what

Carnival's best day of the month was Oct. 18: Shares jumped 11% after the company announced a $2.03 billion offering of senior notes at an interest rate of 10.375%. It also increased the original offering from $1.25 billion due to strong investor demand, a sign that bond investors are confident that the business can recover and remain solvent.

Management said it would use the debt to repay amounts drawn under a revolving credit facility, possibly helping to lower overall interest payments.

The other big day for Carnival during October came on Oct. 12; its stock rallied 10% after UBS upgraded Norwegian Cruise Line Holdings to a buy, with analyst Robin Farley saying that company is seeing a significant improvement in bookings. Investors interpreted that as good news for the cruise industry as a whole.

Now what

Carnival stock plunged at the end of September after the company issued another disappointing earnings report and the stock sank to 30-year lows.

The company reported a net loss based on generally accepted accounting principles (GAAP) of $770 million, and an adjusted net loss of $688 million. However, it continued to make progress on the top line, with sequential revenue growth of 80% and bookings up 15% from the second quarter.

Carnival holds nearly $30 billion in debt and faces around $1.5 billion in annual interest expense, which will make a turnaround challenging.

Wednesday's Fed rate hike also showed that a pivot is probably further away than Carnival investors had hoped. Travel demand should continue to come back, barring a recession, but a return to profitability will take longer.

Either way, expect the volatility in Carnival stock to continue.