Airline stocks slip on higher crude oil prices; SpiceJet slumps ~5%

Aviation stocks were trading under pressure on Friday’s trade after a crude price surge in the global markets.

Jun 21, 2019 06:06 IST India Infoline News Service

SpiceJet
Shares of aviation companies were trading under pressure on Friday’s trade after a crude price surge in the global markets. SpiceJet and IndiGo stocks slipped in the range of 2-5%, respectively.

Shares of Jet Airways hit the lower circuit and fell in today’s trade after the National Company Law Tribunal (NCLT) has admitted State Bank of India’s (SBI) insolvency plea against the company under section 7 of the Insolvency and Bankruptcy Code (IBC), media reports stated. However, the stock has recouped early losses and trading higher on the BSE.

Crude oil prices rallied after President Donald Trump warned that Iran made “a very big mistake” after it boasted of downing a US spy drone. Oil prices reversed earlier gains but benchmark Brent crude was still set for its first weekly gain in five weeks.

According to the media reports, Iran shot down the drone near the Strait of Hormuz, a major choke point for world crude shipments, spurring market fears of a confrontation that could badly constrain supplies.

As per the DGCA report on Tuesday, the air passenger traffic of domestic airlines has increased 3% to 122.07 lakh in May 2019 over 118.56 lakh in May 2018, while snapping 4.5% recorded for April 2019. However, the growth of air passenger traffic has moderated from 16.5% surge in May 2018.

The airline wise seat load factor was Spice Jet at 93.9%, Go Air 93.3%, Indigo 90.9%, Air Asia 87.8%, Vistara 85.6%, Air India 85.0%, Pawan Hans 21.9% and Air Deccan 18.7% in May 2019.

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