The Zhitong Finance App learned that aviation stocks continued to decline. As of press release, Air China (00753) fell 3.65% to HK$3.43; China Eastern Airlines (00670) fell 3.61% to HK$2.27; China Southern Airlines (01055) fell 3.56% to HK$2.71; and Cathay Pacific (00293) fell 2.29% to HK$13.22.

According to the news, the situation in the Middle East continues to escalate, and Brent crude oil remains high at 105 US dollars. Cathay Pacific Haitong Securities released a research report saying that the estimated Q3 passenger flow increased by 3-4% year on year, and domestic fuel ticket prices fell by about 5% year on year. It is estimated that the price of fuel used by airlines increased by more than 40% over the same period last year. Due to weak demand for summer travel and the exchange of price in exchange for volume by airlines, oil price transmission is limited. It is expected that industrial operations will be under pressure. In the traditional low season of Q4, public business performance will be the key.

J.P. Morgan Chase pointed out that China's aviation industry's passenger performance during the Mid-Autumn Festival and National Day holidays fell short of expectations, and aviation continued to lose share to railways rather than a broad recovery in aviation demand. The bank maintains a cautious view, believing that demand is entering a low season, fuel surcharges will increase or further suppress demand, and high fuel costs will continue to put pressure on profits.

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