A reader recently brought to my attention the fact that the BDI and the Shanghai Composite Index both appeared to have peaked from interim-term highs at the beginning of August (see chart). After looking more closely at the data I quickly began to realize the significance of this relationship and its implications on shipping. Let […]
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BDI
The market generally accepts that over the months’ ahead companies will begin restocking dwindling inventories. In fact Goldman Sachs recently updated their 2H09 GDP forecast to 3.0% from 1.0% on the back of expected inventory restocking. This will undoubtedly have a positive effect on US industrial Production, manufacturing, and ultimately US GDP growth for a […]
I noticed an unusual rally in DryShips (DRYS) today, which closed up an astonishing 13.6%. At first I attributed this advance to positive sentiment stemming from better than anticipated new home sales, coupled with speculation over the company’s earnings data and a higher BDI, but after looking at the performance of the rest of the […]
Forward Freight Agreements (FFAs), especially for capesize contracts, appreciated significantly today leading to strong trading in the dry bulk sector. BDI FFA Curve Source: Imarex BCI FFA Curve Source: Imarex Market and Sector Performance:Source: Bloomberg, my calculations, Capital Link Shipping
A recent release by Brazilian officials showed that iron ore exports fell to 15.3mn tones in May, a drop of 35% from last month and a 2009 low. This is likely due to diminishing demand by the country’s largest custom, China. A note released by Goldman Sachs confirms this theory stating, “Heavy rains in the […]
As I have discussed in great detail in my TheStreet.com articles; I believe the recent rally in the Baltic Dry Index (BDI) cannot be sustained, and we are likely to see a pullback in the index; along with dry bulk shipping and mining sector stocks. The BDI’s rally has been driven almost exclusively through China’s […]
I have been receiving a significant amount of email regarding an old entry I wrote back in March 2008 regarding the Baltic Dry Index (BDI). Back in March the BDI was recovering for an interim low it experienced in January on fears of a global economic slowdown, however, since then the situation has become far […]
BDI Revisited in new entry written 11/08/2008 Globalization and world trade has become the major growth force in emerging market economies and has significantly influenced developed nations as well. The big question is; how or has the US led slowdown affected this trend. There are of course a series of indicators we can look at […]