Air China's stock experienced a significant surge of 5.47% during intraday trading on Wednesday, reflecting a strong positive movement for the airline.

The rally is attributed to a collective rebound in aviation stocks following reports that geopolitical tensions in the Middle East may be easing. Iranian President Pezeshkian stated that Iran is prepared to end its retaliatory actions, contingent on receiving guarantees against future attacks. Analysts note that such a de-escalation could alleviate pressure on oil prices, which have been elevated due to regional conflicts, thereby reducing a major cost burden for airlines like Air China.

Market observers caution that while the sentiment is positive, the aviation sector remains sensitive to short-term fuel price spikes and the ability to pass on higher costs through fuel surcharges. The overall improvement in sentiment, however, has provided a lift to airline stocks in the session.