President Obama is set to make a statement on Cuba at noon ET.
The press conference follows news that American aid worker Alan Gross was released from prison in Cuba as part of a prisoner exchange as the US plans to “overhaul” its policy towards Cuba, according to Reuters.
And an AP report on Wednesday said that American officials will “start talks to normalize” diplomatic relations with Cuba.
In an email following this news, Dave Lutz at JonesTrading said that traders are already buzzing about these developments.
According to Lutz, these developments could be a positive for stocks in the cruise line, airline, casino, and hotel space. Reports have also said that telecom equipment can now be exported, which could be a positive for that sector.
Negative impacts could be felt for tobacco names, with the read-through there relating to the potential for Cuban cigars to now be legally imported to the US.
“Many possible reasons for the quick shift —-> Maybe Fidel passed overnight / Geopolitical positioning by US to block Putin in the Caribbean / Collapse of oil ends Venezuela support? Oil revenues vanishing fast.”
Following these developments, the Herzfeld Caribbean Basin Fund, which traders under the ticker “CUBA” and invests in stocks that primarily trade on Caribbean exchanges, was up more than 17%.
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