A 20% slide in Norfolk Southern Corp.'s (NSC) first-quarter freight volume may well accelerate in the second quarter, but the railroad's top executive is voicing optimism nonetheless that the trend is near a bottom.

Wick Moorman, chief executive of the mostly East Coast railroad, said in an interview Wednesday that his view is based mainly on the potential effect of government stimulus spending.

"We don't know how big of a bounce, but we think (the stimulus) may provide some positive momentum" to the overall economy beginning in the second half, he said.

Freight volumes are considered a broad reflection of overall economic activity.

Moorman acknowledged that "very little if any hard data right now" exists in Norfolk Southern's own business to support the contention that freight volumes are nearing a bottom. He also quipped that "our crystal ball is as opaque as anyone's."

Volumes for the mostly East Coast railroad accelerated in the first quarter from an 8% slide in the fourth quarter. Volume fell in all of Norfolk Southern's market segments, with automotive-related freight plummeting 48%, intermodal shipments off 18% and coal shipments down 11%.

Norfolk Southern's first-quarter numbers come on the heels of railroad operator CSX Corp.'s (CSX) results last week, which showed a 17.4% decline in overall volume. CSX said second-quarter volume likely will be down by a similar percentage but declined to predict a trend for the rest of the year.

Moorman said some of Norfolk Southern's volumes so far in April appear to have deteriorated a bit from March, meaning its overall second-quarter slump could exceed the first-quarter's 20% decline.

But he said "the sheer magnitude" of federal stimulus spending, as well as the consensus view of economists both inside and outside the company, gives him reason for confidence in a pickup later in the year.

If that proves to be the case, Moorman said it likely first will be seen in his railroad's automotive and housing related shipments, as well as in shipments of chemicals and in coal used in steel production. He also said intermodal shipments, which include consumer goods, would improve along with consumer confidence.

"There is an enormous amount of stimulus money that is going to be pumped into the economy," Moorman said. "It seems reasonable to assume that might be the trigger to at least start some pattern of recovery, albeit slow."

Late Tuesday, Norfolk Southern posted first-quarter net income of $177 million, or 47 cents a share, down from $291 million, or 76 cents a share, a year earlier. Revenue dropped 22% to $1.94 billion.

Norfolk Southern shares were trading recently at $36.44, off 93 cents, or 2.5%.

-By Bob Sechler; Dow Jones Newswires; 512-394-0285; bob.sechler@dowjones.com