Friday May 9, 2008

Airlines close mixed on oil’s new high

PETALING JAYA: Regional airline stocks finished mixed as crude oil price hit a fresh record of US$123.53 a barrel early yesterday.

Singapore Airlines Ltd's (SIA) share price plunged to a three-week low of S$15.44 before closing at S$15.52.

Hong Kong's Cathay Pacific Airways Ltd, which slipped to a low of HK$16 during the day, finished 2 cents higher. Australia's Qantas Airways was up by 2 cents to A$3.44 while Air New Zealand was down 5.5 cents to 99 NZ cents.

At home, shares in AirAsia Bhd closed unchanged at RM1.22 while Malaysia Airlines ended 4 sen higher at RM3.94.

With the slowing economy threatening to slow consumer demand and oil prices pushing up jet fuel costs, analysts said airlines were expected to see margin erosions in the coming quarters.

“Jet fuel costs may get the better of SIA in the coming financial year,” Citigroup Inc analyst Robert Kong was quoted as saying in a note yesterday.

Meanwhile, crude oil traded little changed as at 5pm yesterday.

“The market's waiting for some direction now either from the Bank of England rate decision or the employment data in the US, when the recent feel-good factor about the economy is gathering pace,” London-based MF Global Ltd senior broker Robert Laughlin was quoted by Bloomberg as saying.

News Poll

Latest Jobs from Star-Jobs

Latest from StarProperty