Shares in container shipping companies jumped Monday after the operators were forced to reroute vessels away from the Suez Canal and Strait of Hormuz following U.S. and Israeli strikes on Iran over the weekend.

The conflict has seen shipping groups including A.P. Moller-Maersk , Hapag-Lloyd and CMA CGM divert vessels away from the region and instead send ships on longer voyages around the southern tip of Africa.

Maersk shares were 5% higher in early European trade while Hapag-Lloyd shares rose 3.9%.

The outlook for shipping stocks had been gloomy as they recently resumed sailing through the Red Sea after avoiding the area for two years following Houthi militant attacks. Journeys between Asia and Europe were expected to become shorter, freeing up vessels that until now have been stuck on longer routes to avoid the area. This, coupled with softer demand, was expected to create overcapacity and weigh on freight rates.

Overcapacity pushed average freight rates 23% lower across all of Maersk’s shipping routes in the fourth quarter, driving a $153 million earnings loss at the company’s main shipping business.

However, with fresh instability in the region, some overcapacity could be taken out of the market as companies resume longer sailing routes, supporting freight rates.

“Shipping stocks like Maersk and Hapag-Lloyd are … sharply higher, reflecting the potential for a significant increase in shipping rates,” said Victoria Scholar, head of investment at Interactive Investor.

Maersk, Hapag-Lloyd and unlisted CMA CGM all said over the weekend that they are avoiding the Suez Canal and Strait of Hormuz until further notice.

Write to Dominic Chopping at dominic.chopping@wsj.com