As Hurricane Florence approaches land, stocks in building supplies and car rental rise

Stocks in weather-sensitive industries reacted as Hurricane Florence moved closer to the U.S. East Coast on Monday.

Shares of building supply and home improvement companies including Beacon Roofing Supply Inc and Home Depot Inc rose, while insurers such as Allstate Corp tumbled.

Florence, the first major hurricane to threaten the eastern United States this year, was forecast to hit the coast of North Carolina or South Carolina on Thursday. North Carolina ordered residents to evacuate the state’s Outer Banks barrier islands, and the governors of Virginia, North Carolina and South Carolina declared states of emergency.

The Atlantic hurricane season, which typically runs from June to November, caused more than $250 billion worth of damage in the United States in 2017.

WATCH: Hurricane hunter flies missions to track Hurricane Florence

0:39 Hurricane hunter flies missions to track Hurricane Florence

But several industries benefited. Car rental and hotel companies saw an influx of customers, while freight companies commanded higher prices as capacity tightened due to increased demand for supplies in areas struck by hurricanes.

Here is a summary of how shares are performing as Hurricane Florence approaches:

Building supplies

On Monday, shares of Beacon Roofing rose eight per cent, their biggest one-day percentage jump in more than a year. Owens Corning shares rose 4.5 per cent and were the top gainers on the PHLX Housing Index.

Shares of generator maker Generac Holdings Inc touched a four-year high and were last up 5.9 per cent.

But Summit Materials Inc shares fell 7.3 per cent after the supplier warned of adverse weather, including Hurricane Florence, hurting performance in several of its markets.

Home improvement

Shares of Lowe’s Companies Inc and Home Depot hit record highs on Monday. Lowe’s shares were last trading 1.8 per cent higher, while Home Depot shares were up 2.2 per cent.

During the 2017 Atlantic hurricane season, Home Depot shares rose 16.3 per cent. But Lowe’s shares only rose 4.7 per cent during that period, lagging the S&P 500, as the chain struggled to compete with Home Depot.

Insurance

Allstate shares fell two per cent on Monday. The insurer had a 10.5 per cent market share in South Carolina and a 6.6 per cent market share in North Carolina, according to Sandler O’Neill.

Shares of Travelers Companies Inc, Progressive Corp and American International Group Inc declined between one per cent and two  per cent.

Car rental

Shares of Hertz Global Holdings Inc and Avis Budget Group Inc surged during much of the 2017 Atlantic hurricane season on investors’ anticipation of increased demand. Hertz shares climbed 156.2 per cent between June and early November, while Avis shares rose 80.1 per cent.

On Monday, Hertz shares rose 2.5 per cent and Avis shares added 1.4 per cent.

Freight

In 2017 between June 1 and Dec. 1, shares of USA Truck Inc soared 172.9 per cent, while shares of XPO Logistics Inc and Old Dominion Freight Line Inc climbed more than 40 per cent. JB Hunt Transport Services shares rose 26.7 per cent over the same period.

On Monday, XPO Logistics shares rose 4.6 per cent. USA Truck shares advanced 2.3 per cent, JB Hunt gained 2.5 per cent and Old Dominion added 1.3 per cent.

Hotels

Shares of hotel operators were little changed on Monday. They had gained during the 2017 hurricane season as demand from guests displaced by hurricanes outweighed the hit from storm damage.

From June 1 to Dec. 1, 2017, shares of Hyatt Hotels Corp jumped 25.8 per cent. Shares of Marriott International Inc, Hilton Worldwide Holdings Inc and Choice Hotels International Inc rose up to 18.9 per cent.