Aviation stocks extended their recent declines. At the time of writing, AIR CHINA (00753) was down 3.96% to HK$4.61; CHINA SOUTH AIR (01055) fell 3.05% to HK$3.81; CHINA EAST AIR (00670) dropped 2.97% to HK$3.59; and CATHAY PAC AIR (00293) declined 1.48% to HK$11.98.

The market is reacting to several factors. Effective May 16, the domestic fuel surcharge for routes under and over 800 kilometers was adjusted to 90 yuan and 170 yuan, respectively, representing an increase of 30 yuan and 50 yuan from the previous period. Additionally, data from Flight Master indicates that the average domestic ticket price including fuel for weeks 14 to 19 was 849 yuan, a year-on-year increase of 15.8%.

Huatai Securities pointed out that since May, China's ex-factory jet fuel price has further increased by 17% month-on-month to 11,475 yuan per ton, indicating that airlines continue to face significant fuel cost pressure. However, carriers have consistently demonstrated their ability to pass on these costs to ticket prices. The brokerage noted that the industry is gradually entering a short-term off-peak season, and the sustainability of this pricing power in civil aviation needs continued monitoring. Concurrently, international oil prices remain at elevated levels, forcing airlines to cut low-yield flights and dampening overall market interest in the sector. While there is currently no clear positive catalyst for the aviation stock segment, the valuation is considered to have become attractive.