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We’ve seen some interesting activity in cruise lines, with Royal Caribbean (RCL) and Carnival (CCL) catching a strong tailwind.
But let’s keep things in perspective…
While there’s been an uptick in these stocks — likely due to post-election sentiment and the possibility of favorable policies ahead — the outlook requires careful consideration.
Cruise lines are enjoying a bit of fundamental support here. If we assume the incoming administration will take a more pro-business stance, there’s potential for increased disposable income among consumers, which may boost discretionary spending.
Cruise operators like Royal Caribbean and Carnival stand to benefit if consumers feel more comfortable splurging on vacations. Add to that the possibility of lower fuel costs — a likely scenario if energy policies favor reduced restrictions — and you get a clearer picture of why investors are eyeing these names with interest.
Now, let’s talk about Tesla (TSLA)…
It’s also been moving sharply higher, but that momentum feels shakier. The potential for a policy shift doesn’t provide the same support for Tesla that it does for traditional, fuel-dependent industries.
Tesla is firmly planted in the electric vehicle and alternative energy camp — sectors that typically gain less from a conservative administration’s policies. Also, there’s the question of Elon Musk’s relationship with the government.
Rumors have been swirling that Musk might take a government position, and if that happens, he could be required to divest a substantial portion of his Tesla holdings.
And here’s the kicker: If Musk is required to sell, that could flood the market with Tesla shares. Typically, government officials required to offload shares may receive tax benefits, potentially turning those sales into tax-free gains.
A sudden influx of Tesla stock on the market — combined with a major stakeholder cashing out tax-free — could put significant downward pressure on the stock price.
So, while RCL and CCL might have some runway under a pro-business administration, Tesla is more of a gamble. For now, I’d approach Tesla with caution unless you’re trading short-term momentum.
Cruise lines seem better positioned for sustained growth under current conditions. But as always, a pullback is likely. Waiting for those moves to settle before diving in can provide a much stronger entry point — especially if these stocks maintain relative strength during any broader market consolidation.
Kane Shieh
Kane Shieh Trading
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