Asian airline stocks sold off as oil prices surge past $100 a barrel
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1 min read . Updated: 24 Feb 2022, 07:38 PM IST - Many airline shares were sold off sharply amid broad declines in regional markets
Asian airline stocks slumped Thursday as crude prices soared after Russia launched military attacks on Ukraine, with higher energy prices set to weigh on their profits while the pandemic situation remains uncertain.
Many airline shares were sold off sharply amid broad declines in regional markets, as investors’ rush to safety pushed down equities.
Japan Airlines Co. closed 6.2% lower and South Korea’s Asiana Airlines Inc. lost 4.6%. In Hong Kong, China’s three major carriers, Air China Ltd., China Southern Airlines Co. and China Eastern Airlines Corp. retreated 3.0%-3.8%. Singapore Airlines Ltd., which is due to release its quarterly results later today, was last down 6.8% to its lowest level since December.
Airline stocks mostly underperformed benchmark indexes. The Nikkei Stock Average fell 1.8%, the Kospi shed 2.6%, the Hang Seng Index closed 3.2% lower and the FTSE Straits Times Index was last down 3.5%.
Front-month futures for Brent crude jumped more than 6% during Asian trading hours to as high as $103.55 a barrel, crossing the $100 a barrel mark for the first time since 2014.
Airlines’ recovery prospects have been weighed by the fast-spreading Omicron variant, which has delayed border reopening plans. Analysts have cited higher oil and jet fuel prices as a key near-term headwind for airlines’ profitability due to the potential increase in operating costs and weaker profit margins.
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This story has been published from a wire agency feed without modifications to the text
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