A lot of investors pay much attention to the Dow Jones Industrial Average but little if any to the Dow Transportation, irrespective of talk about both being antiquated.
But based on the idea that both discount the future, the Transportation index is apparently telling investors something.
The strength of the transportation sector is difficult to ignore. The Dow Jones Transportation Average ended the week just 0.49 percent below its record-high close of 8,676.19, which it reached on Thursday (NYSEARCA:IYT).
On Thursday, September 18, the Association of American Railroads reported that the total combined U.S. weekly rail traffic for the week ending September 13 was 579,440 carloads and intermodal units, exceeding the total for the week ending on August 30. The week ending September 6 brought a decline to 525,144 carloads and intermodal units from the total for the week ending August 30, which was 579,209. The most recent weekly total represented a 3.1 percent increase from with the same week last year.
From the report:
For the first 37 weeks of 2014, U.S. railroads reported cumulative volume of 10,718,782 carloads, up 3.5 percent compared with the same point last year, and 9,522,482 intermodal units, up 5.6 percent from last year. Total combined U.S. traffic for the first 37 weeks of 2014 was 20,241,264 carloads and intermodal units, up 4.5 percent from last year.
The chart below depicts the performance of the iShares Dow Jones Transportation Index ETF (NYSEARCA:IYT) during the past six months. (Chart courtesy of Stockcharts.com).
As the chart demonstrates, IYT finished Friday’s trading session at $154.81, after hitting a record intraday high of $156.28. At Friday’s closing price of $154.81, IYT ended the week 3.15 percent above its 50-day moving average of $150.08.
Investor or central banker, either way someone has to decide what the Transportation index is saying: Higher interest rates now or perhaps too late later?
http://www.wallstreetsectorselector.com/investment-articles/editors-desk/2014/09/investors-see-weekly-rail-traffic-surge/
Investor or central banker, either way someone has to decide what the Transportation index is saying: Higher interest rates now or perhaps too late later?
http://www.wallstreetsectorselector.com/investment-articles/editors-desk/2014/09/investors-see-weekly-rail-traffic-surge/
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