(Bloomberg) — Shipping stocks slumped worldwide after a strike by US dockworkers was suspended after only three days, spurring predictions of a decline in the price of transporting goods by sea.
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AP Moller – Maersk A/S dropped as much as 8.6% in Copenhagen trading, its steepest descent in about eight months, while German peer Hapag-Lloyd AG plunged as much as 14%. Large falls were also seen in Asian shares such as Cosco Shipping Holdings Co. and Kawasaki Kisen Kaisha Ltd, while ZIM Integrated Shipping Services Ltd slid in New York premarket.
Analysts at JPMorgan Chase & Co. said the quick resumption of port operations on the US East and Gulf coasts would weigh on a market that is currently over-supplied.
“Now the strike has lasted just 72 hours we see limited knock on effects and expect freight rates will continue to normalize,” Alexia Dogani and colleagues wrote in a note.
US dockworkers agreed to start moving cargo again while they continue collective bargaining with their employers on a new contract, the union representing the workers said in a statement. Container ports from Houston to Miami and up to Boston had been closed since a contract expired on Tuesday.
Shipping stocks in Asia slumped as news of the suspension first broke, paring gains seen over the past few weeks as industrial action neared.
Tokyo-listed Kawasaki Kisen Kaisha closed down 9.7%, while Pan Ocean Co. fell 5.4% in South Korea and Hong Kong-listed Cosco dropped 7.3%.
“Short-term traders are already reversing their trades,” said Tsuyoshi Hori, an analyst at Mito Securities Co.
–With assistance from Subrat Patnaik and Georgina McKay.
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