Transcript:
Conway Gittens: I’m Conway Gittens reporting from the New York Stock Exchange. Here’s what we’re watching on TheStreet today.
Wall Street took a cautious tone ahead of a Friday speech by Federal Reserve chair Jerome Powell. Investors want to hear what he has to say about the pace of rate cuts expected to begin in September.
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In other news…Dark clouds could be on the horizon for the U.S. economy due to a major railway strike north of the border.
All rail movement by Canadian National Railway and Canadian Pacific Kansas City were grounded to a halt after labor negotiations failed. The two companies told roughly 10,000 union workers to stay home.
A spokesperson for Canadian Pacific Kansas City told CNN: “We’re right up against the fall peak shipping season. You have Christmas presents in containers arriving at ports. If this pushes further into fall shipping period, the consequences are going to be worse.”
$382 billion in cross-border trade happens between the two countries, according to the U.S. Transportation Department, and 14 percent of that happens by rail.
Auto parts are particularly vulnerable as many components cross the border several times before the finished automobile rolls off the assembly line. A disruption in that supply chain could leave American auto factories with no choice but to temporarily go offline.
And it’s not just new car sales in jeopardy, what you serve on your plate is also at risk. Those rails also carry fertilizer used in American food production and chlorine used for water purification.
One U.S. firm estimates a weeklong shutdown could cause $1 billion in economic damage and a major threat heading into the peak holiday gift-buying season.
That’ll do it for your Daily Briefing. From the New York Stock Exchange, I’m Conway Gittens with TheStreet.
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