Created: November 09, 2020 10:31 PM
ALBUQUERQUE, N.M. — The news that a COVID vaccine could soon be a reality translated directly into economic hope Monday. The Dow Jones had its biggest rally in more than five months.
UNM Association Professor of Finance Reilly White explained which industries got the biggest boost.
“If we look at where growth is concentrated it was amazing to see that it was primarily concentrated in the leisure and hospitality sectors,” he explained.
Stocks like AMC, Dave and Busters, Carnival Cruise Lines and large hotel chains—all companies that took huge hits due to the pandemic—saw dramatic growth.
“The bottom line is that better good news regarding a potential end to the pandemic means that the trajectory for recovery will be steeper, meaning that it will be a shorter amount of time before we get to a strong, normal economic situation. And consumer behavior, the way that we spend money will come back as well. That's what the markets are saying,” White said.
The markets also showed positive moves in sectors that directly impact the state budget.
“In the energy sector, we saw oil stocks that have been hit heavily by a loss of consumer demand, increase by about 15 percent and upwards,” White said.
White said it will still take a few years to get the economy looking the way it did before the pandemic, but as of Monday, the trajectory is very promising.
“I think it's fair for people to look at next year's budget and start planning for, I'm knocking on wood here, but if what the markets are indicating and what Pfizer is indicating is true, people can start planning trips, excursions, other things for next year,” he said.
Even with the promising news, White said it’s still a good idea to be careful with your money and to evaluate your personal finances to make sure you have the funds to get you through at least the next three to six months.
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