Aug 30 (Reuters) - Shares of insurance and freight companies reacted as Hurricane Dorian crept toward the Florida coast on Friday, and the National Hurricane Center upgraded Dorian to a Category 3 storm on Friday afternoon.
The Miami-based National Hurricane Center issued a hurricane watch for the northwestern Bahamas, and said Dorian was likely to remain an extremely dangerous hurricane as it approaches Florida through the weekend.
Here are some stocks to keep an eye on as Hurricane Dorian gathers strength:
Shares in freight companies may gain after a destructive hurricane on bets they will see rising demand from businesses shipping in materials for rebuilding efforts. U.S. freight companies include USA Truck Inc, last up 4%, XPO Logistics Inc, last up 2%, Old Dominion Freight Line Inc , up 0.6%, JB Hunt Transport Services, up 1%.
Regional property insurers with exposure to Florida include United Insurance Holdings, HCI Group Inc, Heritage Insurance Holdings, Fednat Holding Co and Universal Insurance Holdings Inc. Fednat was down 2% on Friday and United Insurance was down 2%.
Populations have risen along the Atlantic coast every year since 2000, despite increasing hurricane risks, according to AIR, a catastrophic risk management company. The total insured value of residential and commercial property in Florida’s coastal counties reached $3.6 trillion last year, up from $3.2 trillion in 2015.
Hurricanes have had mixed effects on shares of building products. In September 2018, as Hurricane Florence approached North Carolina, shares of roofing and insulation companies rose while shares of cement companies fell. On Friday, shares of building supply companies, including Owens Corning, Summit Materials Inc, Martin Marietta Materials Inc and Vulcan Materials Co, were little changed overall. One exception was Beacon Roofing Supply Inc, whose shares rose 2.8%.
Shares of Lowe’s Companies Inc were down 0.1% and Home Depot Inc was up 0.2% on Friday. Their stocks have benefited in the wake of previous hurricanes as homeowners made purchases to repair damage.
Shares of hotel operators have gained following previous hurricanes as demand from people displaced by hurricanes outweighed the hit from declines in tourism.
Hyatt Hotels Corp, Marriott International Inc, Hilton Worldwide Holdings Inc and Choice Hotels International Inc were little changed on Friday, up as much as 0.3% and down as much as 0.1%.
Reporting by Sinead Carew, April Joyner and Noel Randewich; Editing by Alden Bentley and Leslie Adler