COVID-19 Impact on Equities in Home and Away Baskets

Investors have broadly been concerned with the epicenter of the contagion, namely the “Away” stocks (Airlines, Hotels, Cruise Lines…). On the other hand, “Stay at Home” orders have benefitted stocks that consumers are using increasingly in a lockdown world (Zoom, Netflix, Clorox…). The Home and Away indices are each composed of 20 names that best represent each basket. These indices are created using the Cirrus Research methodology which picks the top performing stocks in the Home and the bottom performing stocks in the Away stocks.

Stocksnips is tracking the News Sentiment for these two baskets and in the charts above we examine the time period 1/23/2020 to 4/5/2020. The COVID-19 cases reported from Wuhan, China started raising concerns and on January 31, 2020 President Trump suspended flights from China. Subsequently the WHO declared it a Pandemic.

Home Basket

We examine the chart on the left and see that on 2/19/2020 the Sentiment started rising and peaked on 4/5/2020. Price followed and started going up on 3/3/2020. As of May 12, 2020, both Sentiment and Price continue to hold in positive territory though we see some flattening in the last two weeks.

Away Basket

We examine the chart on the right and notice that Sentiment started dropping on 1/23/2020 amid concerns on the COVID-19 crisis spreading worldwide. Price followed dropping on 2/25/2020. The Sentiment and Price rallied towards the end of March 2020 due to actions by the Federal reserve and Government packages for supporting affected companies and employees. Recovery has flattened and looks more like a swoosh rather than a V-shape.