Wall St Week Ahead: Dow Transports index slump poses trouble spot as investors seek stocks stability

Lewis Krauskopf - Reuters - 21/03
Even as U.S. stocks seek to regain their footing, weakness in a closely followed index of transportation shares is a sign of growing investor worries about the economy.
  • Dow transports index down over 17% from November high
  • Struggles as investors worry about growth slowdown
  • Reports next week on consumer sentiment, inflation
NEW YORK, March 21 (Reuters) - Even as U.S. stocks seek to regain their footing, weakness in a closely followed index of transportation shares is a sign of growing investor worries about the economy.
The S&P 500 (.SPX), opens new tab as of Thursday was on pace to post a weekly gain after four straight negative weeks. The benchmark index was clawing back after it marked a correction last week by ending down over 10% from its February record high.

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The Dow Jones Transportation Average (.DJT), opens new tab was little changed for the week, but the 20-stock index has been pummeled recently. The gauge of airlines, truckers, rail companies, package delivery giants and other transport firms has slumped over 17% from its November all-time closing peak.
"The transports are an important tell on future economic activity," said Chuck Carlson, chief executive officer of Horizon Investment Services. "The fact that they have significantly underperformed ... gives me pause."
The Dow Transports is struggling as investors are concerned about an economic slowdown, driven in part by uncertainty over the fallout from U.S. President Donald Trump's back-and-forth tariff policies. The Federal Reserve on Wednesday downgraded its U.S. economic growth forecast this year to 1.7% from 2.1%, with central bank Chair Jerome Powell pointing to "unusu...
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