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The Snow Shovel Trade: How Midwest Freeze Will Impact Insurers, Retailers

Published 12/01/2024, 19:54
Updated 12/01/2024, 21:10
© Reuters.  The Snow Shovel Trade: How Midwest Freeze Will Impact Insurers, Retailers
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Benzinga - by Neil Dennis, Benzinga Staff Writer.

Cities in the Midwest are bracing for a major winter storm that is expected to blast cities, including Chicago and Milwaukee, with strong winds and heavy snow.

The heavy snow forecast along with strong winds will also make for treacherous driving conditions and motorists are being warned not to travel unless absolutely necessary.

Blizzard warnings are in effect across seven states, and forecasters say the storm will be followed by an Arctic air mass that will cover the country over the entire three-day weekend.

It may be too late for many in the region to stock up on winter essentials, but may serve as a reminder to make those purchases ahead of the next winter onslaught.

Sales of hardware items such as snow shovels and flashlights could help boost retailers such as Home Depot (NYSE:HD) and Lowe’s Companies (NYSE:LOW) in the coming weeks, while sales of emergency winter car kits and snow tires could provide shares of AutoZone (NYSE:AZO) some winter pep.

Douglas Dynamics (NYSE:PLOW) could be a stock to watch if the winter does become a particularly harsh. The company manufactures and fits snow plows and salt spreaders, and is based in Milwaukee.

On the downside, it could be a time of heavy claims for insurers. Damage to properties from snow isn’t that common, but it’s a time of high claims on motor insurance policies. The SPDR S&P Insurance ETF (NYSE:KIE) is an exchange traded fund that holds many of the top insurers in the U.S.

Also Read: Airline Stocks Cleared For Takeoff In 2024, But Economic And Consumer Confidence Clouds Gather

Delays At Major Airports

Winter weather alerts are in place across the Plains and the Midwest, and already many airports in the region are reporting significant delays. These include Chicago O’Hare International (ORD), Milwaukee General Mitchell International (MKE) and Green Bay Austin Straubel International (GRB).

Airlines have had a bad week following the incident a week ago when a “plug” door panel blew out on an Alaska Airlines (NYSE:ALK) jet, forcing an emergency landing. Earlier on Friday, a United Airlines (NASDAQ:UAL) flight made an emergency landing after a “door open” light came on.

Cancellations, weak sentiment and an uninspiring 2024 outlook from Delta Airlines (NYSE:DAL), saw the entire sector tumble: United shares sank 9.4%, Delta shed 8.2% and American Airlines (NYSE:AAL) lost 8.3%.

Photo: Shutterstock

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Read the original article on Benzinga

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