Norfolk stock traded as high as $288.11, but closed at $278, down 0.8%, while Union Pacific stock lost 4.5%, closing at $220.52. The S&P 500 added 0.1% and the Dow Jones Industrial Average lost 0.7%.

Union Pacific and Norfolk Southern could announce a tentative merger agreement as early as this week, according to a published report. Bloomberg cited sources familiar with the talks in its report on Friday.

Union Pacific Corp. agreed to acquire Norfolk Southern Corp. in a cash-and-stock transaction valued at $85 billion, forming a transcontinental rail