May 9 (Bloomberg) -- China Shipping Container Lines Co., the nation’s second-biggest cargo-box carrier, plunged the most in almost seven months because of concerns Europe’s economic recovery may wane and about lines’ inability to raise rates.
The operator dropped 9.1 percent, the biggest decline since Oct. 18, to close at HK$2.20 in Hong Kong trading. The benchmark Hang Seng Index fell 0.8 percent.
Container lines including Neptune Orient Lines Ltd. and Orient Overseas International Ltd. also tumbled after Alexis Tsipras, leader of Greece’s Syriza party, said he plans to form a government that would cancel bailout accords, adding to uncertainty about Europe’s economic stability. That could damp shipping demand, undermining efforts by lines to raise rates.
“The decline reflects investors’ concern about the European turmoil,” said Lawrence Li, a Shanghai-based analyst with UOB-Kay Hian Holdings Ltd. “It’s also caused by shipping lines’ recent failure to fully push through rate increases.”
Shipping lines were only able to boost Asia-Europe rates by about $200 per 20-foot container from about May 1, compared with targets of as much as $500, CSCL’s investor relations officer said by phone today. She declined to be named, citing company policy.
China-Europe spot rates rose 1 percent on May 4 from a week earlier to $1,759.74 per box, according to Shanghai Shipping Exchange data.
Orient Overseas, Hong Kong’s biggest container line, dropped 5.5 percent in the city. Neptune Orient fell 4.5 percent in Singapore.
China Cosco Holdings Ltd., the nation’s biggest listed shipping company, slumped 4.7 percent in Hong Kong. The company’s parent separately said that Vale SA, the world’s largest iron-ore miner, was boycotting its dry-bulk fleet. Vale is seeking to gain access to Chinese ports for larger commodity ships.
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