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What Should You Invest in After Hurricanes Harvey and Irma?
As hurricane Irma bears down on the Caribbean with Florida in its sights are there stocks you should be selling and are there stocks you should buy? The Washington Post writes that Korea and back to back major hurricanes have driven the market down. As stocks skid over worries what should you invest in after hurricanes Harvey and Irma?
Major stock indices closed down more than 1 percent Tuesday as traders worldwide reacted to a rapid escalation of the North Korean nuclear crisis, a second powerful hurricane barreling toward U.S. shores in as many weeks and a looming political fight over the increase in the national debt ceiling.
Financial stocks and insurance companies whose balance sheet could be bludgeoned by another hurricane were among the hardest hit. Conglomerate Berkshire Hathaway, which is heavily bent toward insurance revenues, was down nearly 2 percent. Goldman Sachs Group and JPMorgan were down 3 percent and 2 percent respectively. Bank of America was down more than 3 percent as well.
Many investors are investing in gold as a hedge against risk but US treasuries are also up as others flee the stock market. Regarding the hurricanes many stocks will do well because of rebuilding and reinvestment related to hurricane damage. Those in the path of the storms who suffer damage are exceptions. CNBC and Cramer’s Mad Money notes that as Texas rebuilds after Harvey certain stocks will do well.
Cramer expects potentially tens of billions of federal dollars to flood Texas as the waters recede, especially because it is such a largely Republican state.
The massive reclamation project in Houston will likely deliver a boost to an array of companies related to rebuilding, the “Mad Money” host said.
From companies dealing in homebuilding materials – think Weyerhaeuser, Louisiana-Pacific and USG – to road aggregates – Martin Marietta Materials’ wheelhouse – to roofing – the specialty of Owens Corning and Beacon Roofing – Cramer is anticipating a lift across the board.