Friday, October 23, 2009

BDI broke above 3000

Just a quick note that the Baltic Drybulk Index has recovered above the 3000-mark. This is a positive sign that international trade continued to recover, despite earlier uncertainties. Somebody should check whether the "Ghost Fleet of Recession" is still lying off the coast of Singapore.

Chart: Baltic Drybulk Rates' daily chart as at Oct 22, 2009 (Source:


JR said...

Dear Mr. Alex,

How will this reversal help to improve the earnings for local stocks in this sector?

Stock which I think has great potential to improve further ie Freight Mgmt.

Appreciate your feedback.


cheer said...

I was told that the O&G is coming sector which we shouldn't forget. Advise your personal view and any stock recommendation .

Alex Lu said...

Hi JR,

This post is an update on BDI, which was sliding lower recently.

A recovery in shipping rates signals increased demand for our exports, which should benefit our exporters & related industries. However, the recent rally in share prices may have fully factored in this improvement.

Alex Lu said...

Hi Cheer,

O&G stocks have been rising in line with the increase in crude oil prices. However, one cannot be certain about the demand for crude oil. As such, the bullish reversal in BDI is an indication of increased demand for crude oil. So far, many analysts attribute the increased crude oil prices to the drop in the value of USD.