BUYING OF GAMBLING, HOTELS, AND CRUISE LINES IS A SIGN THAT CORONAVIRUS THREAT MAY BE PASSING -- AMERICAN AIRLINES LEADS AIRLINES HIGHER

MARKETS LOOKING BEYOND CORONAVIRUS THREAT... Price action of the global financial markets over the past week strongly suggest that fears of the coronavirus are fading.Major U.S. stock indexes are trading at new records.  Foreign stocks are being led higher by Asian emerging markets, with help from China.   Crude oil and copper prices are rebounding along with stocks tied to them, while safe havens like gold and Treasury bonds are being sold.   Adding to that is the fact that travel-related U.S. stocks with close ties to China are among the biggest gainers this week.  That includes gambling stocks, hotels, and cruise lines which are helping lead the Consumer Discretionary SPDR (XLY) to another record high today.  Airlines are also recovering.

HILTON LEADS HOTELS HIGHER...Chart 1 shows the Dow Jones Hotels Index trading back above its 50-day average and nearing the highest level in a month.   All of the big international hotels with business in China are doing the same.   Chart 2 shows Hilton Worldwide Holdings (HLT) hitting a new record today.  Marriott Intl (MAR) and Hyatt Hotels (H) aren't far behind.  Neither are gambling stocks with casinos in Macau.

GAMBLING STOCKS ON THE RISE...Gambling stocks are also in recovery.   Chart 3 shows the Dow Jones Gambling Index regaining its 50-day line and nearing the highest level in a month.  Chart 4 shows MGM Resorts Intl. (MGM) leading it higher.  Las Vegas Sands (LVS) and Wynn Resorts (WYNN) are making up some lost ground as well.   Chart 5 shows WYNN bouncing off its red 200-day line twice over the past two weeks and trying to stay above its blue 50-day line.   It's the weakest of the three.  But its ability to stay over its red line is encouraging.

CRUISE LINES TRY TO REGAIN RED LINES... Cruise lines that have been among the hardest hit stocks are also trying to regain some lost ground. Chart 6 shows Royal Caribbean Cruises (RCL) trading back over its 200-day average today.   Chart 7 shows Norwegian Cruise Line Holdings (NCLH) doing the same.  Carnival (CCL) which has been hit the hardest is also up today, but remains below its 200-day line.   The bigger point is that the three travel-related stock groups hit the hardest by the coronavirus may have hit bottom.  And that's a good sign.  There's one more.

AAL LEADS AIRLINES HIGHER... International carriers also appear to be in recovery mode.  Chart 8 shows the Dow Jones US Airlines Index bouncing impressively off its 200-day moving average on Monday, and nearing a new high for the month today.  American Airlines (AAL) is the group leader.   Chart 9 shows the airline leader rallying to the highest level in nearly three months.  Chart 10 shows Delta (DAL) also trading above its moving average lines.  United Airlines (UAL) is the laggard in the group, and remains well below its red line.  But it is encouraging to see airlines gaining some altitude again.  That's another sign that the market is starting to look beyond the Chinese virus.