UPDATE 1-Medical, biotech stocks jump after U.S. nurse contracts Ebola
(Adds details on airline stocks, updates prices)
By Yasmeen Abutaleb
NEW YORK Oct 13 (Reuters) - Shares of little-known medical equipment and biotech companies jumped on Wall Street on Monday, after news that a nurse had become the first person to contract the deadly Ebola virus in the United States.
Airline stocks, meanwhile, were hit hard in a broad-market selloff on growing fears of the outbreak that has taken more than 4,000 lives, mostly in West Africa's Liberia, Sierra Leone and Guinea. The S&P 500 lost 1.7 percent on Monday.
Shares of biotechnology company Ibio Inc, hazmat suits maker Lakeland Industries Inc, and face mask maker Alpha Pro Tech Ltd all ended the day with big gains.
Investors have piled into various companies that are either developing treatments for the disease or provide protective gear. Trading volumes have been on the rise, and the market values of some once-obscure names have soared in the span of a few days.
"The spider's web of companies that are beneficiaries of an Ebola outbreak are becoming visible to portfolio managers," said Paul Weisbruch, vice president of ETF and options sales and trading at Street One Financial. "It's not like buying a vaccine that might work. There's something more tangible with someone who supplies hazmat suits."
On Sunday, health officials announced that a nurse at Texas Health Presbyterian Hospital in Dallas became the first person to contract Ebola in the United States. The nurse had treated Thomas Eric Duncan, the Liberian national who two weeks ago was the first person in the United States diagnosed with the hemorrhagic fever. Duncan died last week.
Not every sector has benefited. Concern about travel safety has slammed airline shares; the Thomson Reuters U.S. Airline Index has cratered in the last month, dropping 17 percent in the past 17 trading days. It lost 6 percent on Monday, led by a 7.3 percent drop in United Continental Holdings. Continued...