Airline shares rebounded on Thursday as a trickle of flights resumed from the Middle East, offering relief to carriers after US-Israeli strikes on Iran erased billions from market values earlier in the week.
Governments have been arranging flights to evacuate tens of thousands of citizens stranded by the conflict, which led to the closure of much of the region’s airspace amid missile threats to passenger aircraft. Emirates and Etihad Airways are operating limited services through safe corridors from Dubai and Abu Dhabi, while Qatar Airways flights from Doha remain halted.
Three commercial flights from the UAE to Australia were scheduled on Thursday, following the arrival of around 200 Australians on an Emirates flight on Wednesday night. The US government is also chartering flights to return Americans home, while Canada and India are arranging commercial and charter flights to repatriate citizens stranded across the region.
Many Asian airline shares recovered after double-digit percentage losses earlier this week.
Cathay Pacific gained 4.2%, Qantas rose over 1%, Japan Airlines was up 0.25% and Korean Air Lines jumped more than 5%. By contrast, major Chinese carriers including Air China, China Eastern and China Southern, stabilised after earlier falls, down 1–3% in Hong Kong and Shanghai markets.
“Asian airlines are highly sensitive to Iran’s situation due to exposure through routes and energy in both revenue and costs. Any news on shortening the duration of the war can easily turn sentiment,” said Gary Ng, senior economist at Natixis.
Kenny Ng, securities strategist at China Everbright Securities International, cautioned that the rebound remains short-term and dependent on the evolving conflict.
Airlines have been forced to reroute flights, carry extra fuel and make additional stops, while some stranded travellers have sought alternative exits through Saudi Arabia or Oman, where airspace remains open.
Reuters
