Aviation stocks slide in Malaysia on missing AirAsia flight

KUALA LUMPUR (The Star Online/Asia News Network) - Aviation stocks linked to low-cost carrier AirAsia and Malaysia Airports Holdings Bhd (MAHB) fell in active trade on Monday after Indonesia AirAsia Flight QZ8501 went missing the previous day.

At 9.55am, shares of low-cost carrier AirAsia was down 22 sen, or 7.5 per cent, to RM2.72 while its long-haul affiliate AirAsia X was down four sen, or 6.2 per cent, to 64.5 sen. AAX-CP fell one sen to 3.5 sen. AirAsia shares had plunged nearly 12 per cent on opening.

Tune Ins Holdings lost 13 sen to RM1.63. MAHB was down 17 sen to RM6.63.

News report said Australia joined the Indonesia-led search for the plane which disappeared with 162 people on board, the military said.

Public Investment Research said due to this incident, it expects AirAsia's share price to be under pressure in the immediate term, but it also pointed out AirAsia remains fundamentally strong and is expected to benefit from lower jet fuel cost in 2015.

"Therefore, we are still keeping our Outperform call on AirAsia until the cause of the incident can be ascertained," it said.