William B. Cassidy | Sep 26, 2011 3:33PM EDT
There may be more of a peak in trucking’s peak shipping season than expected this year, according to Morgan Stanley Research. The firm’s dry van truckload freight index increased over the past two weeks, and is trending above average.
“This suggests that (the market) may be underestimating the potential strength of underlying freight demand,” the research firm said in a Sept. 26 note to investors.
Shipper reports of tight truckload capacity and higher rates, while normal for this time of year, seem more a bullish signal for truckload carriers when balanced against diminishing macroeconomic expectations, Morgan Stanley said.
In addition, Morgan Stanley’s refrigerated truckload freight index “has been showing notable upward momentum over the past few weeks,” the company said. The refrigerated index has been climbing steadily since the end of July.
The Morgan Stanley index supports reports from truckload carriers such as Swift Transportation, Landstar and U.S. Xpress of stronger than expected freight demand despite a sour macroeconomic picture of slow growth in the U.S.
“Overall demand in the first two months (of the third quarter) has been relatively stable and pricing has remained strong,” Henry Gerkens, Landstar chairman, president and CEO, said in a recent conference call with investment analysts. “Although there was much talk of a major economic slowdown or double dip recession, Landstar has not seen any evidence of a decline in freight volume.”
Contact William B. Cassidy at wcassidy@joc.com. Follow him on Twitter at @wbcassidy_joc
