CNR little lower today b/c of the oil dip - over reaction due to fear. Oil shipments are a very SMALL part of CNR's business.
02:02 PM EST, 12/01/2014 (MT Newswires) -- North American railroad stocks tumbled for a second day on growing concern that falling oil prices will curtail surging shipments of crude by train, Bloomberg reported.
Kansas City Southern (KSU) slid as much 6.4% in U.S. trading, extending a two-day decline in the Standard & Poor's 500 Railroads Index to the biggest since September 2011. Canadian National Railway (CNR.TO) dropped the most since March 2010.
"With oil prices down sharply, anything related to energy is taking a hit, and the railroads are no exception," Jim Corridore, an analyst at Standard & Poor's Capital IQ, said in a telephone interview from New York with Bloomberg.
CNR slipped 5.2% to $76.98 while Canadian Pacific Railway (CP) fell 5.1% to $209.37.
North American carriers moved 24,784 carloads of crude in the week ended Nov. 22, data from the Association of American Railroads show.
While that's about twice as much as three years earlier, Corridore said crude volumes remain "a very small part of their business."
"It's really an overreaction if you're going to sell off a group of rails on that," Corridore said.