Kolkata: After the cessation of hostilities, investors in both India and Pakistan were supercharged fueling a surge in the benchmark indices. The KSE 100 index of Karachi Stock Exchange surged 9.44% on Monday and opened in the green on Tuesday as well. However, the stock prices of Chinese defence hardware manufacturers showed downward movement on Tuesday, May 13.
While the rise in Chinese defence stocks a few days ago was attributed to Pakistan’s dependence on China-made weapons in the armed conflict with India, the decline is being linked to Pakistan reportedly appealing to the world community to intervene after suffering reverses before India launching an assault last week. India struck first at terror installations in Pakistan occupied Kashmir (PoK) and elsewhere in Pakistan following the terror attack in Pahalgam on April 22, when Pakistan-backed terrorists killed 25 innocent tourists and one local in an incident that shocked the world.
Three Chinese stocks in focus
Two of the Chinese defence companies that showed a clear declining trend on Tuesday were AVIC Xi’an Aircraft Industry Group and AVIC Chengdu Aircraft. At 1:05 Chinese Standard Time on May 13, the stock of AVIC Xi’an Aircraft Industry Group Co. stood at 25.12 yen, down 0.51 yes, or 1.99%. A much sharper crash was recorded by AVIC Chengdu Aircraft. It was trading at 87.59 yen, down 8.27 yen or a whopping 8.63%. The stock price of China CSSC Holdings was at 31.58 yen, down 1.48 yen, or 4.48%. China CSSC Holdings refer to China State Shipbuilding Corporation.
Significantly, AVIC’s subsidiary company AVIC Chengdu Aircraft is the manufacturer of the much-hyped J-10C fighter jet used by Pakistan in the recent conflict. According to reports, India shot down a couple of these aircraft during the armed conflict last week. India also inflicted heavy damaged to Pakistan’s air defence system and Chinese hardware and systems were supposed to be a vital part of Pakistan’s armoury. On Wednesday, May 7, Ishaq Dar, Pakistan’s Foreign Minister stated that they deployed Chinese-made J-10C fighter jets in a clash with India’s air force.
It is recognised that Pakistan is the largest buyer of Chinese weapons which includes an array of fighter jets, air defense systems, naval vessels and unmanned aerial vehicles. Reports from the Stockholm International Peace Research Institute also stated that more than 60% of Chinese weapons exports ended up Pakistan between 2020 and 2024. The rise in prices of Chinese defence stocks was attributed to the view that if the conflict between the two south Asian neighbours escalated, China would supply more defence equipment to Pakistan.
A few days ago when geo-political tension between India and Pakistan was rising Chinese defence stocks were seen rising. But with the cessation of hostilities, they are declining. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
