(Dry-bulk sector item updated to reflect closing stock prices)

NEW YORK ( TheStreet) -- Dry-bulk shipping stocks advanced sharply Monday as the broader equities market surged and shipping rates strengthened following the holiday slowdown.

The Baltic Dry Index, a gauge of the dry-bulk spot market across vessel sizes, rose 4.5% to 3,140 Monday, while the going rate for a capesize ship on the spot market approached $40,000 a day, up 7.5% from last week.

Australian miners BHP Billiton ( BHP) and Fortescue each booked a capesize vessel to haul iron ore to China on Monday morning, fixing the voyages at $12.25 a ton, up from $11.50 last week, but down from the $13.50 a ton those voyages were fetching a month ago, in early December.

Some analysts see near-term support for rates to climb higher. Omar Nokta, an analyst with Dahlman Rose in New York, wrote in a note to clients Monday that "there appears to be some pent-up demand likely to come to market soon." He said 26 capesize ships have been booked on the spot market for January; the 2009 monthly average came to 105 bookings.

Stronger steel and iron ore prices also appeared to help shipping rates (and stocks) on Monday. Natasha Boyden, an analyst at Cantor Fitzgerald, pointed to significant iron-ore buying out of India recently.

The optimism on the first trading day of the year comes as shippers take stock of a newbuildings orderbook that many fear will cause a glut in 2010 and beyond. But such concerns seemed distant during Monday's session.

Genco Shipping & Trading ( GNK - Get Report) led the sector higher. Its shares jumped 10.4% to finish Monday's session at $24.71. Having locked fewer of its ships into long-term contracts than its peers, Genco has more exposure to the spot market and thus would benefit to a greater degree from improving spot rates, said Scott Burk, an analyst at Oppenheimer.

As for the sector-wide strength, Burk also noted the "latent desire" among investors to be long any industry that has strong links to China, which dry bulk certainly does. Furthermore, a weakening U.S. dollar pushed commodities prices higher Monday, which fueld buying action in the shares of all industries tied to commodities, from miners to steelmakers.

Among other names in the high-beta dry-bulk shipping sector, DryShips ( DRYS) shares gained 5.5% to $6.14; Diana Shipping ( DSX - Get Report) added 5.7% to $15.23, and Navios Maritime Holdings ( NM) -- whose sister company, Navios Maritime Partners ( NMM), had one of its ships hijacked last week -- rose 5.5% to $6.38.

Shares of Eagle Bulk Shipping ( EGLE - Get Report) jumped nearly 8% to $5.34, and Excel Maritime ( EXM) surged 8.3% to $6.67.

-- Written by Scott Eden in New York

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Scott Eden has covered business -- both large and small -- for more than a decade. Prior to joining TheStreet.com, he worked as a features reporter for Dealmaker and Trader Monthly magazines. Before that, he wrote for the Chicago Reader, that city's weekly paper. Early in his career, he was a staff reporter at the Dow Jones News Service. His reporting has appeared in The Wall Street Journal, Men's Journal, the St. Petersburg (Fla.) Times, and the Believer magazine, among other publications. He's also the author of Touchdown Jesus (Simon & Schuster, 2005), a nonfiction book about Notre Dame football fans and the business and politics of big-time college sports. He has degrees from Notre Dame and Washington University in St. Louis.