New York-listing shipping stocks eked out a small gain in the past week, but it would have been larger had wind-sector player Eneti not elected to do a $175m equity raise.
The 30 listings under coverage of investment bank Jefferies rose an average 0.7%, beating both the S&P 500's 0.3% gain and a 1% loss by the small-cap Russell 2000 index.
But the gain would have been 2% for the basket of shipping stocks had not Eneti lost 37% on the week after investors demanded a discount to support its sale of 19.44 new shares.
The stock raise, held to back Eneti's plans for wind turbine installation vessel (WTIV) newbuildings in South Korea and Texas, saw the Scorpio Group-backed listing fall from $14.21 to a $9 deal price.
Eneti shares were trading slightly above the deal price on Monday morning on the New York Stock Exchange, after closing at $8.97 on Friday.
The Jefferies Shipping Index is up 70.1% year to date and is up 38.2% year over year.
Eneti is the only wind-sector player under the coverage of Jefferies lead shipping analyst Randy Giveans, and that is because it formerly owned bulkers. The former Scorpio Bulkers sold off its entire fleet to raise money for its transition to wind starting in August 2020.
Companies still operating bulkers gained 1% on the week after spot rates for capesize vessels reversed a weeks-long decline in day rates.
"Last week capesize spot rates rose 17% to about $32,000/day on increased activity in both basins. Despite ongoing concerns around Evergrande, Capesize spot rates should remain relatively steady in the coming weeks as commodity prices stabilise and rising coal demand offsets the weaker iron ore trade," Giveans told TradeWinds.
"Despite the recent volatility, we believe dry bulk remains the most attractive shipping sub-sector based on 2022 supply/demand fundamentals and discounted valuations."
A series of dry bulk owners already have reported record results for the third quarter and indications of even better rates when the current quarter settles.
Major operators Star Bulk Carriers, with the world's largest dry fleet, and Diana Shipping are prepared to report their results this week.
Containership owners have done even better than their bulker counterparts in 2021, and they averaged a 6% gain on the week. Israeli liner operator Zim is expected to unveil outsized profits later this week.
Even better on the week was the performance of LPG operators, with a 9% gain. Giveans credited both better rates and positive news around owners Navigator Gas and StealthGas.
Tanker owners gained 1% on the week while LNG operators dropped 1%.
