The Baltic Dry Index (BDI) has clocked its highest weekly gains this year and was at its yearly highs at 4381 up 161 points or 3.85%
The Baltic Dry Index has been on a rise since 14 consecutive sessions and has gained more than 60% in the last one month

Reasons

This has come mainly due to an increase in demand from China as iron ore imports in the country are on a rise

Lower Interest rates have also helped the cause as easy availability of credit has made it easier to get a letter of credit for the vessels

Ship congestion at Brazil, Australia & China have also contributed to the rise in the index

Conclusion

Shipping stocks have rallied with stocks gaining strength like Mercator Lines (12.51%), SCI (0.23), Essar Shipping (2.59%), Great eastern Shipping(8.60%)

GE Shipping, Mercator Lines & Shipping Corp. India are stocks with good fundamentals and likely to take the major gains as BDI is the major factor for any movement in shipping stocks

Author: Rahul Sonthalia, Analyst, Kredent Group

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