Pakistan Air Force Fighter Jets Maker Avic Shares Plummet
The decline in Avic Chengdu Aircraft's shares and the rally in Indian defence stocks reflect the market's assessment of the recent operation's impact on the region's geopolitical dynamics, with investors weighing the implications for the defence industry and the companies involved.
Avic Chengdu Aircraft, the manufacturer of J-10 fighter jets used by Pakistan's military, saw its shares plummet by 9.31% following Prime Minister Narendra Modi's address on India's successful operation against Pakistan-based terror camps. The J-10 jets were claimed to have been used by Pakistan's military against India during its operation 'Bunyan-un-Marsoos'.
The shares of Avic Chengdu Aircraft crashed to 86.93 yuan in intraday trade on Tuesday, while China's Avic Chengdu Aircraft stock was down 7.51% at 88.66 yuan. This decline comes after the company's shares had surged by 20% on May 12, attributed to the India-Pakistan conflict, but returned its gains on May 9 due to profit-taking sales.
In contrast, Indian defence stocks rallied following the operation, with shares of Dassault Aviation, the maker of the Rafale jets used by India, rebounding nearly 3% in Tuesday's session on the Paris Stock Exchange. The rise in Indian defence stocks and the decline in Avic Chengdu Aircraft's shares reflect the market's reaction to the recent developments in the region.
The market fluctuations highlight the impact of geopolitical tensions on the defence industry, with investors closely watching the developments between India and Pakistan. As the situation continues to unfold, the shares of companies involved in the defence sector are likely to remain volatile.