Hong Kong shipping equities have seen a strong start to trading in the wake of Joe Biden’s successful bid to become the next US president.
Shares in Cosco-controlled liner company Orient Overseas (International) Ltd were up almost 9% in the first few hours of trading on Monday.
Supramax bulker specialist Pacific Basin was up nearly 11%, while Cosco Ship Holdings started the day almost 6% higher as Asia awoke to the news of the Democrat’s victory.
Analysts believe that president-elect Biden will have a less confrontational relationship with Chinese President Xi Jinping, leading to improve trade relations.
"Investors and financial executives took a big sigh of relief on Saturday after major networks declared Democrat Joe Biden winner of the US presidential election, offering some certainty after days of conflicting reports about who might run the White House next term," Singapore research firm Phillip Capital said.
"Although current President Donald Trump said he would fight the results in court, Wall Streeters who offered comments felt there was little doubt Biden would ultimately succeed," it added.
Big weekly gains
Major US stock indexes registered their biggest weekly gains since April this past week, as investors bet Biden would win and the Republicans would hold onto the Senate.
"That scenario would create a steadier hand in the Oval Office and a Congress that would check left-leaning impulses on taxes or regulations that pinch companies, investors," Phillip Capital said.
He will enter the White House with a goal of setting the US on course for net zero greenhouse gas emissions by 2050
Wood Mackenzie
On their new transition website, President-elect Biden and vice president-elect Kamala Harris listed climate change as one of four top issues to tackle on day one.
They are offering American voters a “radically different vision of energy policy” from Trump, focused on addressing the threat of climate change, Wood Mackenzie said.
“He will enter the White House with a goal of setting the US on course for net zero greenhouse gas emissions by 2050 and will take the US back into the Paris climate agreement,” it said.
But the research consultancy warned that there was a “good chance” the Republicans will retain control of the Senate, limiting how much of his agenda he will be able to deliver.
Biden 'boost'
Ed Crooks, Wood Mackenzie vice-chairman, Americas, said the Biden presidency would be “a boost” for the fledgling offshore wind industry.
“The Trump administration has slowed the process of approving offshore wind and proposed to close off a section of the US Atlantic coast from Florida to Virginia,” he said.
“A Biden administration will act faster to support states and companies seeking to develop offshore wind industries.”
Wood Mackenzie said that while Biden has been “strongly critical” of Trump’s decision to take the US out of the international deal over Iran’s nuclear programme, and has promised a change in approach, that does not mean he will move quickly to relax the sanctions that have been imposed since 2018."
“Negotiations about a possible renewed deal are not likely to begin until June 2021 at the earliest, after Iran’s elections, and there is no guarantee that the two countries will reach agreement,” Crooks said.
Singapore-based Braemar tanker analyst Anoop Singh told TradeWinds: “At this time, we do not expect a rapid return of Iranian crude and condensate exports or of the Iranian tanker fleet to international trading in the early days of a Biden-led administration.
“We think the relationship between Iran and the US and US allies in the Middle East changed through the rising hostilities during the last two years.”
Anoop said that will be one factor that prevents a quick return to a pre-Trump US status quo on the Joint Comprehensive Plan of Action (JCPOA) agreement.
“The Biden campaign also wants to improve the terms of the JCPOA, which suggests drawn-out negotiations, including internally between the US president and the Congress,” he said.
“Then there is the uncertainty of how a Biden-led administration will calibrate its relations with Opec+ and how that might affect the alliance between the largest producers of that group.”
