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NOTOS NEWS | MARITIME MONTHLY 
JANUARY 2022

Shipping stocks gained 1.9 percent overall in January despite the challenging environment on the global equities markets. The container sector came in first, followed at some distance by the liner sector.

GEOPOLITICS UNSETTLES THE STOCK MARKETS
The global stock markets were caught on the wrong foot at the beginning of the year. Particularly the past year’s high-flyers, the tech stocks, corrected sharply. Higher interest rate expectations and the flare-up of the Ukraine conflict were the main reasons for this development. In contrast, the omicron variant and the ongoing supply chain disruptions seemed to be secondary to the events mentioned above. 

CONTAINER SECTOR IS ONE STEP AHEAD
The shipping stocks did quite well in January, having gained 1.9 percent overall compared to the previous month. On the other hand, the global stock indices lost significantly. With a performance of more than 11 percent, the container sector was in the lead and well ahead of the second, the liner sector, which improved by almost five percent. The bulker sector and the tanker sector lost the most, regarding the latter especially the crude sector.

STILL VERY STRONG CONTAINER MARKETS
Liner- and container-shipping companies continued to benefit from the aftermaths of the omicron variant, namely supply chain disruptions. This was reflected in stable or even rising container freight- and charter-rates. 

DRY BULK IN THE SEASONAL LOW
Dry bulk TCEs lost further ground in January, with the rates for Capesize bulkers dropping even below the levels of the smaller vessel segments. Whereas the TCEs for Handysize-, Handymax-, and Panamax-vessels fell below USD/d 20,000, Capesize TCEs decreased below USD/d 6,000. Still, we consider this to be temporary and mainly due to the seasonal doldrums around CNY, and the politically restricted commodity demand due to the olympic games.

TANKER SECTOR IN THE STARTING BLOCKS?
Tanker earnings continued to suffer from the OPEC+ members’ inability to keep up with the announced easing of their supply cuts. Once this effect is overcome and demand normalizes, we expect tanker earnings and asset prices to increase, again.

SENTIMENT HAS STABILIZED
The uncertainty on the global stock markets has left its mark on the maritime sentiment indicators. Still, the overall maritime sentiment has remained positive and stable. Likewise, the container sub-indicator is quite strong at a comfortable level.

Both the bulker- and the tanker-sentiment indicators are in negative territory, having declined during Q4 2021 already. Luckily, the latest developments do not seem to have affected the bulker sentiment much, and it is very likely it will pass the investing-threshold in the coming weeks. 

The sharp fall of the tanker sentiment reflects that the winter high has failed this year, again. At least, the tanker sentiment seems to have reached its trough. It may get some tailwind when the oil production picks up further.

TRADING STRATEGY WITH GAINS
The Notos Maritime Strategy Index gained 3.6 percent m-o-m which is a good result given the challenging environment for equities in the reporting period. Thus, it beat its benchmark, the Notos Shipping Index (NSI), again, which was up 1.9 percent. On a 12 months basis, the trading strategy has continuously caught up on its benchmark and is only eight percentage points behind.
  
The focus of our trading strategy has remained on container- and dry bulk-shipping. We expect especially the latter to improve considerably once it has passed its trough. The same goes for the LPG shipping sector which we hope is soon about to leave its seasonal low as well.
  
Please do not hesitate to contact us if you wish to know more about our trading strategies.

GLOSSARY
NOTOS SHIPPING INDICES | Measure the average performance of listed shipping companies in each sector
NOTOS MARITIME SENTIMENT INDEX | Measures the sentiment of global shipping markets, ranks between -1 and +1

NOTOS MARITIME STRATEGY INDEX | Discretionary trading strategy on shipping risks


DISCLAIMER
This document has been prepared and approved by Notos Consult GmbH and is for informational purpose only. The information presented in this report is intended for the recipient to whom it was delivered. Reproduction or distribution of this document in whole or in part is not permitted without the express written consent of Notos Consult GmbH.
This document contains forward-looking statements. We caution the reader that forward-looking statements are not guarantees of future performance. Past returns are no indication of future returns. The development of the industry,
markets and companies described in this document, may differ materially from the forward-looking statement contained herein.

Information and opinions contained in this document have been compiled from sources believed to be reliable. Unless otherwise stated, any statements herein are based on our own estimates at the time of publication. Notos Consult GmbH makes no representation as to the accuracy or completeness of any of the information contained herein and accepts no liability for loss arising from the use of the information provided. 

This document is not an offer of any kind. This report has been prepared separately from any proposed offering of any security and as such information herein must not be relied upon as having been authorized or approved by the issuer of such security.

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