XPO - Why Transports Are Up Today
Shares of XPO Logistics (NYSE: XPO) were up more than 19% as of 3:24 p.m. EDT, and shares of Old Dominion Freight Line (NASDAQ: ODFL) and FedEx (NYSE: FDX) were each up more than 5%, after the White House and Congress overnight announced a deal on a $2 trillion stimulus package.
Trucking and transport stocks have been under pressure for weeks on fears that the COVID-19 coronavirus pandemic would push the country into a recession. The risk is still there, but stocks are rallying after Washington signaled it would do what it can to minimize the damage.
The novel coronavirus pandemic has caused a global slowdown in industrial production and trade, which in turn seems likely to impact shipping volumes for months to come. The question is how deep the slowdown will be, and how long it will last.