Several major logistics and transportation company stocks fell Monday in response to fears of potential trade fallout from a prolonged downturn in the Chinese economy.
Several major logistics and transportation company stocks, including FedEx, UPS and Maersk, fell Monday in response to fears that the economic downturn in China could have a ripple effect on global trade.
FedEx Corp. shares were down as much as 9 percent Monday morning before recovering slightly to end the day down 4.9 percent to $148.37. Competitor United Parcel Service Inc. was down 3.7 percent at $95.51, while Deutsche Post AG, parent of DHL, fell 4 percent to $23.58 by day’s end.
Danish conglomerate A.P. Møller-Mærsk A/S, which owns container giant Maersk Line, ended the day at 10,990 Danish krone (U.S. $1,687.89), down 6.5 percent and its lowest closing price since January.
U.S.-based trucking company YRC Worldwide Inc. also dropped 5.4 percent to end the day at $16.40, about 25 percent below the 2015 high stock price the company set three weeks ago.
Acquisition-heavy third party logistics providers XPO Logistics Inc. and Echo Global Logistics Inc. on Monday dropped 2.5 percent to $34.14 and 4.5 percent to $23.70, respectively.
Shipping and logistics company stock prices could continue to slide if global economic growth decreases as this could, in turn, slow global trade volumes. Despite the stock market swing, David Ross, transportation and logistics analyst at Stifel, said in an advisory note logistics companies should continue to grow, albeit at slower rates.
“It’s just a question of [whether] global trade worsens or not,” said Ross. “If it doesn’t worsen from current levels, there may ultimately be a buying opportunity over the next couple of months.”
Logistics stocks slip amid concerns of slowing global trade
