Shipping-rate futures (known as forward freight assessments, or FFAs) peg the capesize rate in the first quarter of 2010 at $55,000 per day, which signals, of course, that some people believe that rates will fall. But Korsvold said in his note that if spot-rates hold at present levels over the near term, the futures contracts will need to rise and close the gap. On the other hand, he added, "Equities have been stretched and we expect a broad selloff if the market decides we have peaked."
Leading the advancers this time around was Excel Maritime (EXM), whose stock leapt more than 14% to the trading day at $8.40 on heavy volume, though that's still down from the year high of $11.70, reached in early June.
Early June is significant, however, since that's the last time spot shipping rates broke through $90,000 a day, pushed higher by avid Chinese raw-materials stockpiling.
Among other big movers to the upside Wednesday, shares of Eagle Bulk Shipping (EGLE) added more than 10.8% to close the day at $6.75; Euroseas (ESEA) jumped more than 12.3% to $5.02; and Safe Bulkers (SB) rose by more than 5.5% to finish at $9.40.Elsewhere, Genco Shipping & Trading's (GNK) stock price rose 3.8% to $28.25; Diana Shipping (DSX) advanced 4.6% to $17.97 and TBS International (TBSI) picked up almost 4.3% to close the trading day at $8.75.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV