Travel and leisure stocks were hard hit in early trading on Monday as investors weighed the impact of the U.S.-Israel-Iran conflict and higher oil prices.
Carnival Corporation (CCL) slid 10.3% in early action, while Royal Caribbean Cruises (RCL) was down 6.4%, and Norwegian Cruise Line Holdings (NCLH) fell more than 10% as its earnings report and soft guidance also played in.
In the airline sector, the biggest decliners were Frontier Group (ULCC) -9.2%, United Airlines (UAL) -7.2%, American Airlines (AAL) -6.7%, LATAM Airlines (LTM) -5.4%, and Delta Air Lines (DAL) -4.7%. Jefferies said jet fuel prices were a bigger concern with investors across the group than cancellations of flights to the Middle East.
In the hotel sector, Intercontinental Hotels Group (IHG) -5.5%, Hyatt Hotels (H) -5.1%, Wyndham Hotels (WH) -4.1%, and Hilton Worldwide (HLT) -4.1% were all notably lower. Analysts pointed to concerns over Middle East bookings for the next few months, even if the conflict resolves quickly.
Six Flags (FUN) was down 4.6%, with its Saudi Arabia theme park at risk of near-term traffic disruption.
“The tail risk of a sustained conflict is higher than in 2024 or 2025, though we don’t see this war escalating to a point where it drastically changes the U.S. outlook,” highlighted Barclays analyst Ajay Rajadhyaksha on the latest developments.