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Railroad stocks tumbled Thursday ahead of an upcoming executive order from President Joe Biden that’s expected to target that sector and others.
CSX’s stock
CSX,
was down 5.7% and Union Pacific
UNP,
fell 4.2%, while Kansas City Southern
KSU,
lost 7.7% and Norfolk Southern
NSC,
6.9%. The broad S&P 500 index
SPX,
shed 0.8% amid worries about the recovery from the COVID-19 pandemic.
An executive order aimed at big businesses has been expected since last week, but a Wall Street Journal report on Thursday morning revealed that the order aims to take on consolidation and perceived anticompetitive pricing in the railroad and ocean shipping industries.
On Thursday afternoon, White House press secretary Jen Psaki described the forthcoming order as a move that will end up “saving American businesses money on shipping costs” and thereby “lower prices for American consumers.”
“On international shipping, the executive order calls on the Federal Maritime Commission to crack down on unjust and unreasonable fees and work with the Justice Department to investigate and punish anticompetitive conduct,” she told reporters during a briefing. “On domestic freight railroad, the executive order urges the Surface Transportation Board to allow shippers to more easily challenge inflated rates when there is no competition between routes.”
Among ocean shipping stocks, A.P. Moller-Maersk
MAERSK.A,
closed down 2.1% in European trading, while the Stoxx Europe 600 index
SXXP,
fell 1.7%.
