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Shares of shipping related companies on the Stock Exchange of Thailand saw steep gains today after the Baltic Dry Index (BDI) rebounded after having dropped amid rising concerns of a global economic slowdown.
Shares of companies such as Regional Container Lines Plc (RCL) were up by more than 6.11% to be trading at 34.75 Baht a share, Thoresen Thai Agencies Plc (TTA) were up 6.02% to trade at 8.80 Baht a share, while Precious Shipping Plc (PSL) were trading up 5.88% to trade at 18.00 Baht a share.
BDI, which gives an indication of which way the freight rates were heading has been on a downhill trajectory for the past few months despite the shortage of ships and containers across the world. The rising fuel prices has also taken a toll on the industry, but the fuel cost has had minimal impact as the industry has been able to pass on the rising cost of fuel to their customers.
Despite the nearly 7% rise in BDI today, the index remains down by as much as 30% year-to-date and during this month alone the decline in the BDI has been as high as 13%.
Fears of a global slowdown, coupled with the near zero economic growth in China during Q2, 2022 has sent a sense of fear down the industry that a recession would be a big blow to the shipping industry.