Monday, December 8, 2014

Railways dropping alongside oil again

Well, the transports index doesn't look that bad:

But that hides some horrible weakness in rails.

CN is caving in.

Norfolk Southern is caving in.

And even Union Pacific, greatest railway in the US, is getting a bit of a beating today.

Because, I guess, oil is down and therefore... reasons, or something.

I'm getting more convinced that we'll see the US market roll over for a bit. Because, again, reasons. Also, HYG is rolling over too.

Cheap oil is fantastic for the US, but that won't matter to the market til everyone's finished repositioning. Til then, chaos.


  1. Sorry if this is a double post, but the other just vanished.
    A lot of the recent growth in rail business has been transporting oil. If oil price is down because demand is falling, maybe there's not so much business for rail anymore.

    1. The oil production hasn't disappeared yet.

      And as long as the US is growing, there will still be demand for transport of grain, cattle, manufactured goods, and various imports.