The Zhitong Finance App learned that aviation stocks rose across the board today. As of press release, China Eastern Airlines shares (00670) rose 8.76% to HK$2.73; China Southern Airlines shares (01055) rose 7.56% to HK$3.13; Air China (00753) rose 6.92% to HK$4.015; and Cathay Pacific (00293) rose 3.20% to HK$15.14.

According to the news, the US midterm election results came to fruition, the Democratic Party unexpectedly swept through both houses of the Senate and the House of Representatives, and the Trump administration faced the risk of a “lame duck.” Brent crude oil once plummeted by more than 10% on Wednesday, falling below $95. US Vice President Vance publicly attributed the loss of the Republican election to the war in Iran, further strengthening the market's expectations that the Trump administration would seek diplomatic channels and avoid the escalation of the conflict. Democratic Senate leader Schumer also promised to push for an end to the war in Iran.

For the aviation industry, oil prices are the most direct variable on the profit table. In the first three quarters of this year, the three major airlines lost a total of 8.435 billion yuan, all citing a sharp rise in aviation fuel costs as the main reason for the change in performance. Wanlian Securities previously pointed out that if oil prices fall later and the core factors suppressing aviation stocks are mitigated, the sector is more resilient to repair.

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