When the pandemic struck America in March, the stock market imploded.
Sectors closely tied to the “in-person” economy — travel, energy, restaurants, and retailers without an online presence — were hit the hardest.
Meanwhile, digital-friendly sectors such as cloud computing, streaming, at-home wellness, and gaming surged.
Yesterday, promising results from Pfizer’s phase 3 vaccine trial sparked a huge rotation in stocks, perhaps highlights of what’s to come.
- Airlines: A vaccine is the first step in getting travelers back in the air. The sector ripped higher with Delta (+17%), American (+15%), and JetBlue (+22%) leading the way.
- Energy: Pretty simple — if you’re not going anywhere you don’t need gas. The energy ETF XLE (+14%) jumped in hopes of a pickup in global movement of just about anything.
- “Oh sh*t I might need to see other people”: The reality of the need to get dressed again set in as appearance stocks — from makeup (Ulta Beauty, +15%) to high-end clothing (Ralph Lauren, +20%) — saw huge gains.
- At-home fitness: Who didn’t take advantage of Peloton’s $10 monthly sub during lockdown? Investors are clearly worried orders will dry when gyms reopen, and $PTON (-20%) was down big.
- Remote work plays: Will a return to work reduce the need for Zoom meetings and Docusign virtual signatures? $ZM (-17%) and $DOCU (-15%), 2 COVID staples, both had brutal days.
- Chillin’ at home: Are the days of ordering Dominos, and bingeing Netflix numbered? $DPZ (-6%), and $NFLX (-9%) were both down.
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