Chinese airlines rally on strong travel demand in summer peak season

 

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Shares of Chinese airlines stage a strong rally in Hong Kong, with Juneyao Airlines surging nearly 8%, Air China and Spring Airlines up nearly 7%, China Eastern Airlines, China Southern Airlines and China Airlines gaining more than 5%. 

Travel supply chain will see surging demand in the short term during the travel demand during the summer peak season, which will provide catalyst to the stocks of airlines, airports, highway, high-speed railway, etc, Huatai Securities said in a note. 

Meanwhile, given the weak economic recovery, high dividends and the concept of “valuation system with Chinese characteristics” for Chinese state-owned enterprises are expected to boost highway, railway, port stocks, it said.