Drewry: Shipping Stocks Drop in Reaction to Market


According to the latest Equity Research report released by Drewry, August saw Korean stocks outperforming the rest with both HMM And Hanjin delivering positive returns of 36% and 9%, respectively.

NOL’s stock generated a negative return of 11% in August, 2015 – the second biggest fall after Wan Hai.

Drewry believe the market reacted to the capacity cuts recently announced by the G6 alliance, which NOL is a part of. Members of the G6 Alliance, in mid-August, announced additional four void sailings in their Asia-Europe trade-lane in response to changes in market demand.

All three Japanese operators – MOL, NYK And K-line, registered negative returns of 8%, 6% and 3% in August, respectively.

Three-month returns were also disappointing with negative returns ranging from 12% to 19%. Yet, operationally, the tide could turn favourably in the second half for the Japanese carriers, on the strength of both the dry bulk and tanker shipping sectors.

AP Moller-Maersk’s value eroded by 2% in August and 15% for the three months between June and August, 2015.

The flag-ship company – Maersk Line – is going through its biggest turmoil and may see suspension of two-to-four larger strings in Q4, 2015 to lift vessel utilisation.

Total volumes, especially on the Asia – Europe route, may also take a hit this year due to de-stocking in Europe, sanctions against Russia and a strengthening yuan against the euro.

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