DryShips, Shippers Rise, Rates Hit October 2008 Highs
DryShips Inc. (DRYS) gained 9.6 percent and other shippers posted gains after shipping spot rates increased to the highest level since October on accelerating charter demand.
DryShips rose $1.45 to $16.58 in Nasdaq Stock Market composite trading.
The Baltic Dry Index, a measure of shipping costs for commodities, advanced for a fourth consecutive day. The index fell 92 percent last year as economic growth slowed and international credit markets contracted. It’s up 13 percent since Jan. 5.
“Investors appear to be investing based on the anticipation that in 2009 the credit markets may be thawing, that world trade will resume, that the massive stimulus packages will be supportive of dry-bulk demand, and that the BDI will come off historic lows,” Urs Dur, an analyst at Lazard Capital Markets in New York, said in a note.
The index tracking transport costs on international trade routes rose 51 points, or 6.2 percent, to 872 points, according to the Baltic Exchange. That’s the highest since Oct. 30.
China, the world’s biggest steelmaker, announced in November a 4 trillion-yuan ($590 billion) stimulus package running through 2010. U.S. President-Elect Barack Obama is pressing for a stimulus plan of about $775 billion, including tax cuts and spending on roads, schools and the energy infrastructure.
Genco Shipping & Trading Ltd. (GNK) added 44 cents, or 2.4 percent, to $18.64. Diana Shipping Inc. (DSX) rose 55 cents, or 3.9 percent, to $14.69. Excel Maritime Carriers Ltd. (EXM) gained 12 cents, or 1.4 percent, to $8.91.
The daily rate to charter a Capesize ship, the largest dry-bulk carrier, gained 20 percent to $13,274 a day.
“Excess vessel supply continues to be cleared out,” Omar Nokta, an analyst at Dahlman Rose & Co. in New York, said in a note. “Other sectors of the market are more muted, but Capesize momentum is carrying through to some extent.”
A Capesize is capable of moving 175,000 tons of cargo.
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