HK Stock Market Move | China Eastern Airlines (00670) dropped more than 5% after its results were released, with net loss narrowing by over 60%. Institutions point out that it is difficult to fully pass on the increase in fuel prices.

China Eastern Airlines (00670) fell by more than 5% after its performance report, dropping by 3.6% to HK$3.48 by the time of publication, with a turnover of HK$87.2636 million. On the news front, China Eastern Airlines announced its annual performance, with total revenue of 139.941 billion yuan, a year-on-year increase of 5.92%; shareholders' net loss of 1.633 billion yuan, a year-on-year narrowing of 61.36%; total profit reached 274 million yuan, achieving positive results for the first time since the outbreak of the pandemic. The operational essence continues to improve. It is worth noting that the tension in the Middle East continues to escalate, with aviation fuel prices doubling in just one month. Changjiang pointed out that considering the excessive fuel surcharges may put pressure on downstream demand, price-sensitive consumers may find it difficult to fully bear the cost of airlines, thus it is expected that some of the increase in fuel costs will be difficult to fully pass on when oil prices exceed $80. This will have a negative impact on the total profit of airlines.