Thank you, China

Dry-bulk shares staged a dramatic rally Wednesday, with eight owners gaining by more than 20% after word that China is preparing to add to economic stimulus measures.

Nasdaq-listed Eagle Bulk Shipping climbed by 51.7% to close at $4.49 after Cantor Fitzgerald analyst Natasha Boyden upgraded the company from "sell" to "hold".

George Economou's DryShips saw its shares shoot upward by 39.8% to $3.90, while bulker and tanker owner OceanFreight's stock price improved by 53% to reach $1.27.

Oppenheimer analyst Scott Burk tied the rally to news that China's government is launching a legislative meeting this week to put forward new economic stimulus measures.

He said data released Wednesday also shows that manufacturing activity in the country improved in January.

"The dry-bulk industry specifically is very highly correlated to economic activity, especially industrial production, in China," he told TradeWinds.

Genco Shipping & Trading, FreeSeas, TBS International, Excel Maritime Carriers and Navios Maritime Holdings also saw their shares jump by more than a fifth.

Broader markets also rose Wednesday, with the Dow Jones Industrial Average adding 150 points, or 2.2%, as world markets took part in the optimism on China.

Burk says the dry-bulk stocks often amplify the movements of broader markets, and he says another factor in Wednesday's gains could be recent overselling.

Most of the rest of the shipping and offshore sectors also joined in the upward trend, led by boxship owner Danaos Corp, whose shares jumped by 25.7% to $3.86.

Among vessel owning companies, gaining shares outnumbered decliners by nearly six to one.

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