With the ups and downs of orders, a look at transportation/Fastenal raising prices/Dimon comments

Reflecting the ups and downs of orders in response to the on and off tariffs, the June Cass Freight Index was flattish from May with a .2% slight decline. They are though still down 2.4% y/o/y. Cass said "The trade war is having a variety of effects, with a few waves of pre-tariff inventory building and subsequent drawing down, but volumes were steady from May." They are expecting the 3^rd year in a row of shipment declines in 2025 as the manufacturing recession continues on.

The bottom line from Cass, "Forward-looking visibility remains highly dependent on policy developments and legal challenges. The uncertainty has lowered the economic outlook, and pre-tariff inventory building will lead to destocking regardless of the outcome of trade negotiations in the coming months. The effects of tariffs may worsen, as higher goods prices reduce affordability and real incomes. With this outlook, the cycle upturn for the transportation industry remains elusive."

More on the manufacturing and industrial side of the US economy came from Fastenal yesterday in their earnings call:

"And when I think about the growth this quarter, market conditions, they haven't really helped us and remained sluggish."

"Trade policy continues to create some caution. Notwithstanding this uncertainty, we did not detect any meaningful pre-buying ahead of tariffs." They do think the market is showing signs of stabilizing.

"supply chains have gotten more expensive, and a part of our response over time will be incremental pricing...During the second quarter, we implemented three separate pricing actions, which aim to contribute 3% to 4% of price by the end of the second quarter of 2025. The phased approach to this rollout resulted in 140 bps to 170 bps of additional impact in the second quarter, with momentum building as we ended the quarter. Additional pricing actions will be necessary in the second half of 2025, with the potential to double the impact of pricing, depending upon where the deferred tariffs ultimately settle and the pace and execution of our actions." I bolded to highlight.

From Jamie Dimon in the JPM earnings release: