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Investing.com-- Hong Kong-listed Chinese airline stocks retreated on Monday amid reports that an outsized number of flights to Japan were being cancelled due to a growing diplomatic row between Beijing and Tokyo.
Cathay Pacific Airways Limited (HK:0293), China Southern Airlines Co Ltd (HK:1055), and China Eastern Airlines Corp Ltd (HK:0670) fell between 1.4% and 2.5%, ducking broader gains on the Hang Seng index. The three were also mostly nursing losses over the past week, with Cathay having lost the most at 3.7%.
Reports citing data from aviation industry tracker Flight Master on Monday showed 12 major routes between mainland China and Japan had been canceled, amid a wave of cancellations by airlines and Chinese travelers.
Bloomberg reported late last week that about 30% of the 1.44 million trips to Japan from China planned through end-December had been canceled over the past two weeks, especially after Beijing issued a travel advisory on Japan. Local media reports also showed airlines issuing mass refunds for canceled flights to China.
This came as a diplomatic spat between the two countries, over Japanese Prime Minister Sanae Takaichi’s comments on military intervention in Taiwan, showed few signs of cooling. Efforts by Tokyo to send envoys to Beijing also yielded middling results last week, as Chinese state media and lawmakers kept up their harsh rhetoric against Tokyo.
Japan is a popular holiday destination for Chinese travelers, with the year-end winter holidays being a peak season for travel. Concerns over a dearth of Chinese tourists this year had sparked deep losses in Japanese tourism and entertainment stocks last week.
Japanese media and film stocks also retreated on reports that Chinese theaters were delaying the release of some upcoming Japanese films.
Japanese markets were closed for a holiday on Monday.