MSNBC:
U.S. stocks plunged in 2008 as both consumers and businesses cut back on travel spending.
Demand for hotel rooms weakened in the spring and summer as soaring gas prices, the housing market crisis and broader worries about the economy helped make the “staycation” — a vacation spent at home — a new trend for anxious Americans.
The outlook for major hotel companies like Starwood Hotels & Resorts Worldwide Inc. and Wyndham Worldwide Corp. worsened in September as turmoil in the financial markets prompted many businesses to slash travel spending and rattled consumers further.
“In September and October, things really fell off a cliff in terms of reservation bookings,” said Friedman, Billings, Ramsey & Co. analyst Patrick C. Scholes.
As hotel occupancy dropped, so did lodging stocks. The Dow Jones U.S. Hotels Index plunged 58 percent in 2008, while the Dow Jones Total Market index lost 40 percent. The Standard & Poor’s 500 Index, meanwhile, shed 39 percent.