'The Shipping News'

Posted on Monday, 23 August 2010 [GMT +1]

The novel of the same name by E Annie Poulx won a Pulitzer Prize. It is the story of Quoyle (no known Christian name), a third rate reporter who is woefully unlucky in love until he finds pain-free revivification on New Foundland. For the record, a ‘quoyle’ is a knotted rope on a ship’s deck which may be walked on.

The Baltic Exchange publishes the shipping news every day and in the last two weeks its Dry Index has sailed to its biggest two week gain (36%) in 14 months as Chinese iron ore buying extended a surge in charter rates. What’s more with eight days of August left, the Baltic Dry Index has risen 40% this month while capesize rates having doubled (to $34,913 per day). This is both good and bad news.

Elsewhere two major property company chairmen have said prices will fall 10 to 15%. But this comes against a slew of first class corporate results including China Construction Bank, Sinopec and Wuhan Steel. And, the stock market nudges forward most days and the Shanghai Composite is now some 12% up from its 5 July low.

Finally spare a compassionate thought for the victims of the wretched flooding in North East China, which has caused death and destruction, and the evacuation of more than a quarter of a million people. But as Quoyle said, as his redemption beckoned: “I believe a broken man can heal”.

Shanghai Composite:
Today: -0.11% at 2,639.37 at close
Last week: +1.4%
YTD: -19.5%

Hang Seng:
Today: -0.39% at 20,899.01 at close
Last week: -0.4%
YTD: -4.4%

Oil: $73.87
Gold: $1229.50
Euro/$: 1.2716

Headlines

• Baltic Dry Index has biggest two week gain in 14 months as China buys iron ore
• Iron ore trade to rise 19% this year; as Rio sets Q3 prices
• JPMorgan trims Chinese economic growth forecasts on “loss of momentum”
• Wen says political changes must be maintained to sustain China's growth
• Three views on real estate prices – all cautious
• Ministry of Finance will deposit Yuan 40 billion with commercial banks for three months
• China Construction Bank reports that its Q2 profit climbed 20% on loan demand
• Sinopec net unexpectedly rises as China's economic growth spurs oil demand
• Wuhan Steel says H1 profit rises 90.4%, as prices rise 15%