Investor interest in transportation stocks, including airlines and shipping companies, has surged following news of a peace agreement between the U.S. and Iran.
On June 14, the U.S. and Iran reached a peace deal, leading to a significant drop in international oil prices, which fell to their lowest level in three months. On the previous day, Brent crude futures for August delivery closed at $83.20 per barrel, down 4.9% from the prior trading day. Meanwhile, West Texas Intermediate (WTI) crude for July delivery fell 4.8% to $80.75 per barrel on the New York Mercantile Exchange (NYMEX).
The decline in oil prices has particularly benefited the transportation sector, as the resolution of geopolitical uncertainties surrounding the Strait of Hormuz is expected to reduce fuel costs for airlines and shipping companies.
According to the Korea Exchange, the KRX transportation index has risen by 7.71% in recent days. This index includes 13 stocks related to air, sea, and land transportation.
Among individual stocks, airline shares have shown remarkable strength. Jeju Air has surged by 17.97%, recording the highest return. Other airlines, including T'way Air (15.97%), Asiana Airlines (10.89%), Jin Air (10.53%), and Korean Air (10.15%), also experienced double-digit increases.
In the exchange-traded fund (ETF) market, there has been an influx of buying in shipping-related products. During the same period, the SOL Shipbuilding TOP3 Plus Leverage ETF rose by 16.54%. Other notable ETFs include TIGER Shipbuilding TOP10 (9.48%), KODEX Eco-Friendly Shipbuilding Active (9.37%), and SOL Shipbuilding TOP3 Plus (9.28%).
Foreign investors have shown a preference for transportation stocks, with net purchases of 2.96 million shares of Korean Air and 1.88 million shares of HMM over the last two trading days. As a result, these stocks ranked second and third in net foreign purchases during that period.
Industry analysts believe that if tensions in the Middle East continue to ease, expectations for improved performance in the airline and shipping sectors will grow. For airlines, the cost of fuel constitutes a significant portion of total operating expenses, making the drop in international oil prices directly beneficial for profitability. The shipping industry is also expected to benefit from the normalization of shipping routes through the Strait of Hormuz, alleviating logistics disruptions.
* This article has been translated by AI.
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