Shipping stocks nosedived yesterday amid renewed investor concern about the state of the shipping market, fuelled by doubts about the recovery in Europe.
Jon Windham, the Asian maritime analyst at Barclays in Hong Kong, said it was a 'pretty ugly day across the board'.
Jinhui Holdings saw its stock slump 10 per cent after it warned revenue and net profit for the first quarter were expected to be 'significantly worse' than last year. The counter later recovered to close 4 per cent down at HK$1.44.
The firm derives most of its revenue from Jinhui Shipping and Transportation, in which it owns a 54.77 per cent stake. Chairman Ng Siu-fai said Jinhui Shipping had had to 'enter into some loss-making charter contracts in early 2012' as the volume of new tonnage being delivered outpaced cargo demand and depressed freight rates.
Rival shipping lines also took a battering. Shares in China Shipping Container Lines crashed more than 9 per cent to HK$2.18 before edging up to close at HK$2.20. Orient Overseas (International), parent of Orient Overseas Container Line, dropped 5.5 per cent to finish at HK$46.85. China Cosco, Pacific Basin Shipping and SITC International also saw their share prices fall by more than 4 per cent, while China Shipping Development closed more than 3.9 per cent down at HK$4.65.
