The seasonal escapade is here! Carnival Corp. and Norwegian Cruise Line Holdings Ltd. had a boost in their stock prices as market analysts anticipate a continuous rise in travel demand. The cruise industry's bookings have now surpassed historical levels, with minimal cancellations attributed to loyal customers eagerly resuming their summer vacations. JPMorgan and Bank of America upgraded their ratings and raised price targets for the three major cruise companies, resulting in a 14% surge in Carnival shares and an 8% gain for Norwegian Cruise Line. Additionally, commercial airline shares also saw an upward trend, fuelled by declining crude oil prices and an increasing demand for flight seats, with Southwest Airlines, Hawaiian Holdings, and American Airlines leading the charge.
The S&P500 and Nasdaq had a strong start to the week as investors focused on tech stocks ahead of the Federal Reserve's meeting and inflation data. Apple and Alphabet led the tech climb, while chip stocks like AMD saw gains on AI euphoria. Some experts predict that the recent rally in tech stocks will expand to other sectors, and value stocks may become attractive again as the economy heads towards a soft landing with plenty of liquidity to go around.
Gold prices remained within a tight trading range as traders awaited key U.S. inflation data and major central bank meetings. The yellow metal struggled to break out of its range due to a lack of catalysts and uncertainty around U.S. monetary policy. Canadian gold exports reached record highs in April, propelled by increased shipments and rising prices.
Oil prices halted on Tuesday after a sharp drop the previous day. Concerns surrounding global supplies, demand growth, and China's economic recovery continue to put downward pressure on oil prices while market participants wait for interest rate decisions from central banks and demand outlooks from major organisations in the industry before making any significant moves.
The dollar strengthened slightly as investors adopted a cautious stance ahead of interest rate decisions by central banks. The Federal Reserve is expected to maintain interest rates this month, but uncertainty remains, and market participants are waiting for cues from Fed Chair Jerome Powell. The European Central Bank is anticipated to raise rates twice in the coming months, while the Bank of Japan is likely to maintain its loose monetary policy.