Last week, LNG shipping stocks experienced modest growth, with the UP World LNG Shipping Index (UPI) rising by 1.45%, mirroring the performance of the S&P 500. Despite the overall growth, the market remained subdued, primarily due to low trading volumes. The mixed market performance underscores the ongoing challenges for LNG shipping companies, particularly those dealing with low charter rates and expiring contracts.
UPI and S&P 500 Performance
The UP World LNG Shipping Index, which tracks publicly traded LNG shipping companies, gained 2.47 points to close at 172.96, marking a 1.45% increase. This movement was in line with the S&P 500, which also gained 1.45% during the same period. The weekly chart shows the correlation between the two indices, reflecting the broader market sentiment.
Market Sentiment and Challenges
Last week was notably quiet for LNG shipping stocks, with low trading volumes being a significant factor. While the UPI continues to grow, not all companies are faring well. Many are struggling with low charter rates, especially those with expiring or terminated contracts. Awilco LNG’s recent announcement regarding its WilForce carrier operating at spot rates highlights this issue. Although spot rates are slowly increasing, driving some activity in multi-month deals, challenges persist for companies whose long-term contracts are coming to an end.
Key Performers
Among the top gainers last week, Exmar NV (BSE: EXM) led with a 6.3% increase in stock value, despite trading only 46 thousand shares. Capital Product Partners (NASDAQ: CPLP) saw a 2.9% rise, and NYK Line (TSE: 9101) gained 2%. Exmar’s stock closed above its previous range, while CPLP moved further into its range, nearing the midpoint. NYK Line, however, closed just below its resistance level after a slight decline.
Stock Analysis and Noteworthy Patterns
While overall growth was modest, some stocks showed interesting weekly candle patterns, worth monitoring closely. Nakilat (QSE: QGTS) gained 0.9%, closing above a previous ‘Hammer’ candle on the support line. Chevron (NYSE: CVX) recorded a slight increase of 0.2%, while Flex LNG (NYSE/OSE: FLNG) posted gains for the third consecutive week, likely influenced by a close ex-dividend day. Although FLNG’s volume was near average, it still suggested accumulation, albeit without a decisive breakout.
Mild Declines
The declines in LNG shipping stocks were relatively mild. Awilco LNG (OSE: ALNG) experienced a 5.1% loss, mainly due to a reduced dividend driven by spot rates for its WilForce carrier. Despite this, ALNG’s stock remained stable in the short term. Korea Line Corporation (KRX: 005880) saw a 4% loss, continuing its volatile trading pattern within a broad range. Dynagas LNG Partners (NYSE: DLNG) also faced a 2.3% decline but remained close to its support line, trading sideways.
Support and Resistance in Focus
New Fortress Energy (NASDAQ: NFE) managed to hold its support line despite a 1.1% loss. The weekly candle’s shadows indicated a struggle between buyers and sellers to determine the next trend direction. Trading volume for NFE was above average, reflecting increased activity since early August when the stock experienced a sharp 15% drop in one week.
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Source: lngshippingstocks.com
