Aviation stocks staged a collective rebound during the trading session. At the time of writing, CHINA EAST AIR (00670) rose 4.94% to HK$4.04, AIR CHINA (00753) climbed 4.9% to HK$4.92, CHINA SOUTH AIR (01055) advanced 3.54% to HK$4.10, and CATHAY PAC AIR (00293) increased 1.04% to HK$11.70.

In the first quarter of 2026, all seven major listed domestic airlines reported profits, with the three largest carriers collectively turning losses into gains, delivering their strongest quarterly results in recent years. Data shows that the average domestic jet fuel price borne by the three major airlines fell by approximately 8% year-on-year in the first quarter. This is because airlines' fuel procurement costs primarily reflect prices locked in several months earlier.

Analysis indicates that it takes at least four to six weeks for international oil price surges to translate into higher domestic jet fuel procurement expenses. The full impact of cost pressures is expected to materialize mainly in the second quarter.

Huachuang Securities noted that aviation stocks have already undergone significant adjustments due to rising fuel costs in the short term. The increase in domestic route fuel surcharges effective April 5 has helped airlines partially offset cost pressures. However, the brokerage emphasized that medium-term supply-demand dynamics remain favorable, with strong supply-side constraints and resilient demand growth. International routes are expanding faster than the overall market, boosting traffic turnover and creating potential opportunities amid recent declines.