Shares of shipping companies most likely to be affected by the escalating violence in the Middle East logged solid gains in early trading in New York on Friday as investors reacted more aggressively than their counterparts in Asia and Europe.
The largest movement came in tanker stocks currently most reliant on passage in the Red Sea. These moved up between 2% and 5% in the first two hours of trading, with the notable exception of Belgian owner Euronav. Volumes ranged between average and elevated.
Also surging was Israeli liner company Zim, whose fortunes have been boosted lately by the greater tonne-miles and higher rates associated with diverting cargoes away from the Suez Canal. Its shares climbed nearly 6% to $14.52, with morning trading volume already double a day’s norm.
John Fredriksen’s Frontline was one of the bigger gainers in tankers, advancing 4.6% to $22.39. The VLCC powerhouse traded as many shares in two hours as it typically does in a day.
Fellow VLCC owner DHT Holdings gained 3.4% to $11.07, with similar dynamics on turnover.
Diversified tanker owner Tsakos Energy Navigation was one of the better early performers with a 4% gain to $24.33, also on elevated volumes.
Two more big shipowners with diversified tanker fleets also had strong gains. New York-based International Seaways put on 3.5% to $51, while Teekay Tankers advanced 3.4% to $55.90. Both showed normal trading volumes.
A major spot player in suezmax cargoes — Herbjorn Hansson’s Nordic American Tankers — was up 3.6% to $4.50 on above-average volume.
Gains were smaller for owners with tonnage purely in clean products. Market bellwether Scorpio Tankers climbed 1.5% to $64.66, while Ireland-based owner Ardmore Shipping improved 1.3% to $14.98.
But at least one company was not invited to the day’s tanker party.
Belgian owner Euronav, which spent the day in Antwerp talking about its green initiatives, fell flat with US investors, showing a fractional loss to $17.54 on average trading volume at midday in New York.
Euronav sold 24 modern VLCCs to Frontline last year as part of a deal in which the Saverys family took control of Euronav, but it still has 17 VLCCs and 22 suezmaxes in operation, and otherwise might be expected to benefit from the same dynamics that propelled its tanker peers in Friday trading.
US and UK forces carried out surgical airstrikes against Houthi targets after the Yemeni militia group ignored repeated warnings to stop attacking commercial shipping in Red Sea.
The Houthi attacks pushed many owners, largely in the container shipping, tanker and car carrier segments, to divert their ships around the Cape of Good Hope. The moves were a boon to freight markets.
Overall, US stocks were slightly down at midday. The Dow Jones Industrial Average fell 0.44% to 37,544, while the Nasdaq dipped 0.22% to 14,937.
