Key Highlights:
- Avic Chengdu Aircraft stock tumbled over 9% after PM Modi’s firm statement on Operation Sindoor.
- The selloff follows Modi’s declaration that India won’t tolerate nuclear threats or terrorism.
- Indian defence stocks rallied sharply, while Chinese defence firms, including Avic, faced heavy losses.
- Analysts suggest a pullback to 73 yuan could offer a potential re-entry point for traders.
Shares of Chinese defence manufacturer Avic Chengdu Aircraft, best known for producing the J-10 fighter jets used by Pakistan, took a sharp hit on Tuesday, May 13, tumbling as much as 9.31% to 86.93 yuan during intraday trading. The drop came on the heels of Indian Prime Minister Narendra Modi’s assertive address to the nation, where he emphasized India’s resolute stance against terrorism and nuclear blackmail, highlighting the success of Operation Sindoor.
PM Modi’s speech delivered a strong diplomatic and military message, particularly targeting Pakistan. He stated that India’s air defence systems had effectively neutralized aerial threats, asserting that missiles and drones from Pakistan “fell like straws” before Indian defences. Modi also declared that Operation Sindoor marks a “new normal” in India’s anti-terror strategy, signaling a tougher posture that could reshape regional military dynamics.
Following these remarks, Indian defence stocks saw a surge, while Chinese military-linked equities like Avic Chengdu suffered a significant selloff. Interestingly, despite the current drop, Avic’s stock had recently climbed over 60% since May 6, coinciding with the early stages of Operation Sindoor. The recent dip, however, suggests a wave of profit booking amid rising geopolitical tensions.
Market experts like Anshul Jain of Lakshmishree Investment suggest that the stock’s recent high of 97.55 yuan may have triggered a technical correction. Jain believes that if the stock retreats to its previous breakout level around 73 yuan, it could present a buying opportunity—provided signs of support and demand re-emerge. Investors are advised to monitor the situation closely, particularly as geopolitical developments continue to influence market sentiment.
Disclaimer: This article is intended for informational purposes only and does not constitute investment advice. Always consult a certified financial advisor before making any investment decisions.
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