Shipping Stocks: Sector Floats on Oil, Rate Increases
Updated from 1:43 p.m. EDT
Shipping stocks were solidly in the green Monday after
Maersk Line
became the latest carrier to say it will raise freight rates, starting in the weeks ahead.
A precipitous decline in freight rates plus a glut of vessels that outstrips demand have done a number on the sector, which is well off its highs from a year ago.
According to
Reuters
, Maersk Line, a unit of A.P. Moller-Maersk, will raise rates between Asia and Europe. The changes will take effect in two stages, first in April and then again in July.
Last month,
APL
, a unit of Singapore-based
Neptune Orient Lines
, announced freight rate increases. According to a press release dated Feb. 19, APL will raise its rates between $100 and $175 for eastbound routes from Europe to Asia, beginning next week. For shipments from Asia to Europe, the increase will be $250, effective April 1.
Furthermore, as
RealMoney.com's
Rev Shark contends, the dry bulk group tends to mirror changes in oil prices, which headed back toward $50 a barrel Monday.
With this in mind:
Diana Shipping ended the day up 4.4% to $12.38.
Eagle Bulk finished up 11.2% to $5.05 after an intraday high of $5.44.
Genco Shipping closed up 4.4% to $12.83.
Excel Maritime was up 3.3% to $4.04.
DryShips rose 10.6% to close at $4.06.
