Union Pacific Railroad reported third-quarter revenue of $5.94 billion, 10 percent less than the same period in 2022, and a 19-percent reduction in profits, which fell to $1.5 billion.

Earnings per share slipped to $2.51 from $3.06 a year earlier.

Demand for freight hauling services fell across a range of sectors, the railroad reported, including chemicals, coal, energy-related products, and metals. Forest product cargoes were off 13 percent due to a decline in home construction, The Wall Street Journal reported.

Intermodal transport—linking ocean shipping, rail, and highway haulage—also suffered a loss of volume as retailers worked off backlogged inventories and consumers bought fewer items.

The railroad’s intermodal business dropped 6 percent in the quarter and revenue, measured by average revenue per rail car, thumped down 13 percent.

The company’s share price closed at $206.76 on 23 October, down from a five-year peak of $273.38 on March 25, 2022.

TREND FORECAST: We have been reporting the falling shipping volumes for several months. The facts are clear: Falling volumes for shippers indicates weakened consumer spending and factory production, two factors highlighting the likelihood of a recession ahead.

A bad situation is getting worse. Hitting its lowest level since the height of the COVID War in November 2020 when the continent was locked down to fight the COVID War, the HCOB’s flash euro zone Composite Purchasing Managers’ Index (PMI), which has been on a down note for several months, fell to 46.5 in October from September’s 47.2. A number below 50 signals contraction. 

With the EU economy in decline, it is a sure bet that the European Central Bank, which meets on Thursday, will end their ‘higher-for-longer’ interest rate line and begin to signal that not only will they hold them at the current level, but also that they will be coming down sooner than later.