Asian carriersÆ shares jump after ratings upgrade
A host of Asian shipping lines saw their share price jump Monday after Credit Suisse lifted its rating on the liner sector to 'overweight' and forecast the beginning of an up-cycle in 2008.
'Some excess capacity growth is expected to continue in the next few years,' Credit Suisse said. 'However, capacity growth will begin to ease after peaking in 2006 and continue to decrease until 2009, as orders placed today are slated for 2009 or 2010 delivery.'
The investment bank predicted flat average freight rates in 2007, and a 5 percent increase in 2008. It also upgraded its ratings for Evergreen, Wan Hai Lines and Yang Ming to 'outperform' from 'underperform.' For China Shipping Container Lines (CSCL) and Singapore's Neptune Orient Lines, owners of APL, Credit Suisse switched to “outperform” from 'neutral.'
Following the upgrades, the share prices at the major Chinese carriers CSCL and China COSCO Holdings, owners of COSCO Container Lines, improved 11.5 percent and 8 percent, respectively, at close of business.
Taiwanese carriers also surged, with the country's biggest line, Evergreen Marine, rising 5.6 percent. Taiwan's second-largest operator, Yang Ming, closed the day up nearly 7 percent, while Wan Hai gained 3.3 percent.
NOL's share value increase 6 percent.