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Shipping shares fall sharply amid widespread Wall Street sell-off

The broader stock market began its decline on Thursday following weak US manufacturing data and a sell-off in tech and chip stocks, with tanker companies seeing the steepest drops in the shipping sector

The decline over the past few days in US-listed shipping equities is just the latest since a peak was reached by many listed owners in May, several of whom have seen much of this year’s gains wiped out

WALL STREET got off to a disastrous start in August — and US-listed shipping stocks have been hammered along with the rest of the market.

Shipping stocks have outperformed the Dow Jones Industrial Average and other indexes during some periods. Not so on Thursday and Friday. Shipping stocks, in general, fell more than the Nasdaq Composite, S&P 500 and the Dow. The decline in shipping stocks accelerated in early trading on Monday.

The broader stock market began its decline on Thursday following weak US manufacturing data and a sell-off in tech and chip stocks, with declines accelerating on Friday when government data showed lower growth in hiring and the highest US unemployment rate since 2021.

The Dow partially rebounded late Friday, but not the tech-heavy Nasdaq Composite — and not shipping stocks.

The most recent drop in shipping equities marks just the latest leg down since year-to-date highs were reached by many of these equities in May. Shipping stocks fell sharply in early June, initially appeared to stabilise and partly rebound, then slumped back again before sharply dropping yet again in early August.

Here’s how US-listed shipping equities performed versus the major indices amid the broader Wall Street sell-off on Thursday and Friday:

Crude and product tanker owners

The Nasdaq composite declined 4.7% over the last two days’ trading sessions, with the S&P 500 shedding 3.2% and the Dow 2.7%.

Tanker stocks have been the worst-performing shipping segment amid the latest sell-off.

Teekay Tankers closed Friday down 11.2% from Wednesday, with crude carrier owner Okeanis down 9.3%, product tanker owner Ardmore down 8.5%, and crude and products tanker owner International Seaways dropping 7.4%. At the other end of the spectrum, product carrier owner Scorpio Tankers declined only 3.3% since Wednesday.

 

 

Teekay Tankers’ share price is down 21% since the end of May, and it has now given back all of its gains since mid-January.

Dry bulk owners

Dry bulk stocks have also fallen more than the broader averages, though less so than tanker stocks.

The stock of Pangaea Logistics, which operates small bulkers, fell the most over the past two days, down 8.7%, followed by shares of Golden Ocean, a major player in the capesize market, down 7.2%. Capesize owner Seanergy lost the least ground, down only 2.9%.

 

 

Star Bulk, the largest US-listed owner by market cap, was down 5.1% over the past two trading sessions and is down 19% since the broader shipping equity decline began in early June. Its share price has fallen all the way back to mid-January levels.

LPG and LNG carrier owners

Gas carrier performance has been mixed. Liquefied petroleum gas carrier stocks have, in general, fallen more than liquefied natural gas carriers stocks in the most recent sell-off.

Leading the declines was very large gas carrier (VLGC) owner BW LPG, down 7.8% from Wednesday, followed by StealthGas, an operator of small LPG carriers, down 7.7%. Shares of VLGC owner Dorian LPG fell 6.8%.

 

 

Dorian’s stock has declined over the past three months in line with the general retreat in shipping equities. It has also suffered from the aftermath of its follow-on share offering on June 5. Since immediately prior to that offering, its adjusted closing price has declined 24%. Its shares are now trading at mid-March levels.

Mixed-fleet operators

Owners with diversified fleets have followed the same downward path as pure players.

The stock of Costamare, which owns bulkers and containerships, led mixed-fleet losses with a decline of 7.9% over the past two trading sessions. CMB.Tech, formerly Euronav — which owns crude tankers, bulkers, containerships and chemical carriers — dropped 6.2%.

 

 

Container liners and ship lessors

Container shipping is down with all the other segments, but curiously, given rising concerns about unemployment and the strength of the US economy, liner stocks have fared the best during the early August pullback.

Shares of liner operator Zim were down 3.6% from Wednesday, while liner operator Matson was essentially flat (down 0.7%).

 

 

Matson is an anomaly among shipping equities. Its shares have been on an upward climb since 2020. At one point on Friday morning, as the rest of Wall Street was selling off, its shares briefly touched their all-time high.

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