Market Overview

The Hurricane Matthew Disaster Play Selloff

The Hurricane Matthew Disaster Play Selloff

The Hurricane Matthew disaster trade is giving up some of this week’s gains on Friday, as it appears as if Florida has avoided the worst-case scenario.

Rather than a direct hit on the coastline, Matthew’s eye has so far stayed between 30 and 50 miles off the shore, as the storm works its way northward. Coastal cities have still been hit by torrential rains and wind gusts exceeding 100 mph. However, that 30-mile buffer has likely saved Florida from a significant amount of destruction.

While Florida residents are cheering the news, shares of home improvement stocks are pulling back on Friday as the Matthew saga plays out. Home Depot Inc (NYSE: HD) is down 1.3 percent and Lowe’s Companies, Inc. (NYSE: LOW) is down 0.9 percent. Beacon Roofing Supply, Inc. (NASDAQ: BECN) is also down more than 2.8 percent in early Friday trading.

Related Link: Hurricane Matthew Could Disrupt Southeast Travel Plans For Weeks

Despite the fact that more than 600,000 Florida residents are already without power due to Matthew, generator stock Generac Holdings Inc. (NYSE: GNRC) is also down 4.5 percent on Friday.

At this point, Matthew has been downgraded to a Category 3 storm, but it is expected to continue to wreak havoc as it works its way up the East Coast in the next couple of days. Melbourne, Daytona Beach, Jacksonville, Brunswick, Savannah, Charleston and Wilmington are among the towns included in the latest hurricane warnings

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