Shipping stocks fell sharply against the trend, with Sea Express (01308) down 8.86% to HK$20.05, COSCO Shipping Holdings (01919) down 7.31% to HK$12.18, and Orient Overseas International (00316) down 6.74% to HK$106.5 as of the time of writing.
On the news front, according to media reports, a massive strike by US dock workers in the weeks leading up to the election threatened to disrupt the US supply chain, but the strike ended after a few days. The union representing tens of thousands of dock workers and the shipping industry reached a preliminary agreement on wages and extended an expiring contract to January 15, 2025. Citigroup previously noted that a US port strike lasting less than a month would not have a significant impact on freight rates.
It is noteworthy that Goldman published a research report, upgrading the investment rating of COSCO Shipping Holdings from "Sell" to "Neutral", as geopolitical tensions have intensified in recent years, adding complexity to the shipping supply chain, including longer shipping routes on some routes, which may benefit some Chinese shipping companies such as COSCO Shipping Holdings during the supply chain disruption, driving up the expected return on equity and supporting the P/E valuation.