Shares of Shipping Corp. of India and Great Eastern Shipping Co. rose on Monday, extending their gains for the second day amid escalating geopolitical tensions in the Middle East. Israel and Iran continued attacks on each other over the weekend, entering the fourth day of conflict.
The rise in shares comes as investors anticipate a spike in tanker and container freight rates as both countries continue to launch attacks on each other.
Shipping Corporation of India shares rose nearly 7% on Monday after they were up nearly 15% in the previous session, while GE Shipping rose nearly 4%. It had seen a rise of nearly 8% on Friday.
This is the highest level in six months for Shipping Corporation. However, the shares of GE Shipping had hit a six-month high on Friday.
The advance in stock comes as markets expect disruptions in the supply chain and rising transportation premiums across critical oil shipping routes.
Geopolitical tensions rose after Israel attacked Iran's strategic location which caused the death of several commanders and scientists on Thursday.
Israel has declared a state of emergency on anticipation of a retaliatory attack from Iran. Iran's Supreme Leader Ayatollah Ali Khamenei said that the country will respond, as reported by Bloomberg. Both the countries have continued the attack and counter-attack through the weekend pushing commodities like gold and crude to new highs.
Oil prices in the international markets advanced as traders flock to the safe-haven assets after geopolitical tension rose again, following Israel's air strikes in Iran. Brent crude August future contract surged 1.48% to $75.33 a barrel on Monday after it rose over 13% in the last session to touch the highest level since Jan. 27.
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