A broad-based drop in shipping stocks was unfolding in New York on Tuesday morning, apparently on worries spreading from China over the adequacy of economic stimulus measures.
On a day that the broader US market indices were flat or slightly up, shipping equities headed south.
Leading the early losers was Greece-based Seanergy Maritime Holdings, whose pure-play fleet of 19 capesizes is particularly linked to the health of iron ore volumes and China trade.
Seanergy shares fell nearly 6% to an intraday low of $11.29 before ticking up slightly in morning trading on the Nasdaq exchange.
The bad news spread across dry bulk peer companies, as Bimco estimates that 39% of bulk cargoes — mainly coal, iron ore and grain — are carried to China.
Star Bulk Carriers, Golden Ocean Group, Genco Shipping & Trading and Safe Bulkers all lost more than 2% of share value in the early hours.
Greece’s Diana Shipping — which is insulated from swings in the dry spot market by its heavy charter book — stood alone in making a fractional gain in early trading to $2.51.
Results were not much better in the tanker trade, where one-quarter of demand is linked to China volumes.
Market bellwether Frontline, whose fleet includes a large complement of VLCCs, led the strugglers with an intraday low of $24.53 that was 4.5% lower than Monday’s close of $25.68.
VLCC specialist DHT Holdings stumbled nearly 3% to $11.61. Product tanker giant Scorpio Tankers fell nearly 3% to $71.10, as did competitor Hafnia to a low of $7.25.
One company not seemingly affected by the China malaise was Israeli liner company Zim, which recently took losses related to the end of a US ports strike on the East Coast.
Zim shares rebounded more than 4% on Tuesday to an intraday high of $19.72.
The trouble in China came after markets opened on Monday from a week-long break and originally acted bullishly towards the stimulus plans, sending stocks to a two-year high.
But then equities dropped 9.4% on Tuesday — the biggest fall in 15 years — after remarks from economic planner chairman Zheng Shanjie were deemed short on details reflecting a plan to lift China out of its worst slump since the Covid-19 pandemic, Reuters reported.
