Surging Transport Stocks On Brink Of Further Upside, Buoyed By Reopening Economy, Tight Capacity

Surging Transport Stocks On Brink Of Further Upside, Buoyed By Reopening Economy, Tight Capacity

Share to Linkedin While trucking and railway stocks have surged over the past year, some analysts see further upside in the transport sector as the U. S. economy continues to reopen and strengthen, thereby boosting demand for freight, while a new round of stimulus should push up spending on goods. Train on tracks running along the Mississippi River levee in downtown Davenport Iowa. (Photo by: Don ... [+] & Melinda Crawford/Education Images/Universal Images Group via Getty Images) Since recent lows of Mar. 15, 2020, the iShares Transportation Average ETF - which holds major railway, freight, transport stocks - has more than doubled in value, outpacing the 70% jump by the S&P 500 index over that time. In a recent research report, UBS transportation analyst Tom Wadewitz said he saw a "perfect storm" of positive fundamentals for the transport sector - including favorable freight demand, tight capacity, inventory rebuilding and a steady stream of stimulus money to pump up goods spending. The transport sector received a boost over the weekend when Canadian Pacific Railway announced a $29 billion deal to acquire Kansas City Southern. Wadewitz said in a research note Monday that the Canadian Pacific- Kansas City Southern merger was a