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Oct 10 (Reuters) - Bear Stearns upgraded the U.S. ocean shipping sector to “market weight” from “market underweight,” saying it was positive on dry bulk fundamentals over the next 6 to 18 months.
The brokerage, however, downgraded oil tanker operator General Maritime Corp GMR.N to “peer perform” from “outperform,” partly due to low tanker rates that is likely to continue through the fourth quarter of 2007.
Bear Stearns analyst G. Scott Burk said he continues to remain cautious on the tanker side as growing capacity and a slower demand growth outlook lead to declining day rates through 2010.
“Our near-term bias remains dry bulk — on back of higher day rates, we think the stocks can continue to rise in the current environment,” Burk said in a note to clients.
Dry bulk shipping firms Quintana Maritime Ltd QMAR.O and Ultrapetrol (Bahamas) Ltd ULTR.O have the most valuation upside, Burk added. (Reporting by Tenzin Pema in Bangalore)