World News – US – Cruise stocks rise after CDC lifts shipping ban order, allowing industry to plan to return

Cruise stocks rose on Friday after the Centers for Disease Control and Prevention announced it would replace its nearly 8-month-old no-sail order with a conditional update order less restrictive « 

Navigation ban order expires Saturday The new conditional order will remain in effect until November 1, 2021, the expiration of the Department of Health and Human Services public health emergency declaration or when CDC Director Dr Robert Redfield decides to end it

Shares of the world’s largest cruise line, Carnival, climbed more than 11% on the news Friday afternoon, before leveling off at around 7% Shares of Norwegian Cruise Line rose more than 6% and those of Royal Caribbean increased by more than 5%

The CDC change does not mean sailing in US will resume next week, or potentially anytime, especially as new coronavirus cases continue to climb

The new ordinance establishes a framework that will help the industry to implement safety measures that will allow it to resume operations in US waters in a phased approach, the CDC said in a statement before restarting operations passengers in any commercial form, companies will face CDC testing of the security of their protocols, the agency said

“This framework provides a path to resume safe and responsible navigation,” Redfield said in a statement “This will mitigate the risk of COVID-19 outbreaks on ships and prevent passengers and crew from sowing outbreaks in ports and in the communities where they live »

The CDC initially issued a navigation ban order for cruise ships in US waters on March 14 after hundreds of coronavirus infections and several Covid-19 deaths were reported aboard ships with epidemics across the world The CDC previously said « cruise ship travel is exacerbating the global spread of Covid-19 » to justify the order

While most industries have suffered from the pandemic, the cruise industry is among the hardest hit Stocks of Royal, Carnival and Norwegian are down at least 50% from January 1, however, all three have outpaced broader market gains since their troughs in mid-March Shares of Norwegian, for example, are down nearly 70% since January 1, but have recovered some gains since their 52-week low on March 18 The stock has risen more than 100% since then

Last month, Redfield pushed to extend the order until February 2021, according to Axios, who cited two people familiar with the Axios case reported that Vice President Mike Pence had rescinded Redfield to extend the ban until in October 31

The CDC’s announcement on Friday comes after Royal and Norwegian teamed up to hire a handful of epidemiologists and former US health officials to develop a public health proposal for the CDC that would allow them to resume navigation

Former Food and Drug Administration Commissioner to President Donald Trump, Dr. Scott Gottlieb, and former Utah Governor Mike Leavitt, who also served as HHS Secretary under President George W Bush, co-chair of the panel experts

« CDC and the cruise industry have the same goal: a return to passenger navigation, but only when it is safe, » Leavitt said in a statement. << As part of CDC for orders of conditional navigation, cruise lines have been given a way to systematically demonstrate their ability to navigate while ensuring the safety and health of passengers, crews and their destination ports "

The CDC said companies will have to « demonstrate compliance with testing, quarantine, isolation and social distancing requirements » before moving forward on restart Companies should also build their own laboratory capacity to perform tests on crew members and possibly passengers, CDC said.Â

The agency said it will help ships prepare for a return to sailing by creating a dedicated cruise ship lab team, updating their technical instructions and preparing to collect data with ships for passenger surveillance

« We look forward to reviewing the new order and are confident that this is an important step towards getting our ships back to service from the US, » said Kelly Craighead, CEO of Cruise Lines International Association , a trade association representing the world’s largest cruise lines

Disclosure: Dr Scott Gottlieb is a CNBC contributor and is a member of the board of directors of Pfizer, genetic testing start-up Tempus and biotech company Illumina He is also co-chair of Norwegian Cruise Line Holdings and the Healthy Sail Panel of Royal Caribbean

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Cruise ship, Centers for Disease Control and Prevention, Carnival Cruise Line