India-Pakistan ceasefire: Chinese defence stocks drop up to 9% after rising during Operation Sindoor
Prior to the India-Pakistan ceasefire, Chinese defence stocks had seen substantial gains (AI image)
Chinese defence stocks
saw significant declines of up to 9% on Tuesday as investors retracted their positions following an unexpected ceasefire agreement that reduced tensions between India and Pakistan in South Asia.
The Hang Seng China A Aerospace & Defence Index declined 2.9%, with major components
AVIC Chengdu Aircraft
and Zhuzhou Hongda Electronics Corp falling up to 9.2% and 6.5%, respectively, according to an ET report. This marked a notable shift from their recent gains, which were driven by anticipated increases in Chinese arms sales to Pakistan during a brief period of heightened tensions with India.
Prior to the ceasefire, Chinese defence stocks had seen substantial gains, as investors anticipated Beijing's increased role in supplying arms to Pakistan during a potential extended conflict. On May 8, AVIC Chengdu Aircraft's Shenzhen-listed shares increased by up to 16%, while Hong Kong-listed AVIC Aerospace gained over 6%. Zhuzhou Hongda, producer of the
PL-15 missiles
allegedly used by Pakistani forces, also recorded significant increases.
Also Read |
India-Pakistan ceasefire: How India's punitive measures will continue to hit Pakistan's fragile economy - explained
The market response followed the May 10 ceasefire announcement, after four days of intense cross-border attacks. India's "Operation Sindoor" targeted terror camps in Pakistan and Pakistan-occupied Kashmir, which led to counterattacks from Islamabad using drones. Pakistan's forces utilised Chinese-manufactured weapons, including drones and missiles, though India's air defence systems intercepted these.
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
2025: Steel Suppliers From Mexico At Lowest Prices (Take A Look)
Steel Suppliers | search ads
Search Now
Undo
During the confrontation, Pakistan employed AVIC Chengdu Aircraft's J-10C fighter jets in their operations. Pakistan's Foreign Minister Ishaq Dar confirmed in Parliament, "Chinese-made J-10C fighter jets were used in the engagement with Indian fighter jets."
Pakistan's military utilised PL-15 air-to-air missiles, manufactured by Zhuzhou Hongda. These armaments demonstrate the substantial military cooperation between China and Pakistan, as evidenced by arms trade statistics.
India's military officials have presented photographic evidence demonstrating Pakistan's deployment of various weaponry. This included Chinese-manufactured PL-15 LR beyond visual range air-to-air missiles, along with Turkish-made Byker Yiha kamikaze drones and Asisguard Songar drones. The evidence also revealed their use of long-range rockets, loiter munitions and quadcopters.
"Our integrated air defence (AD) systems stood like a wall and they (Pakistan) could not breach it.
Whether it's a Turkish drone or anything else, it fails in front of the technology of India," director general of air operations Air Marshal A K Bharti said.
Also Read |
Operation Sindoor: Can Pakistan economically afford a protracted conflict with India as tensions escalate? Here's a reality check
The Stockholm International Peace Research Institute (SIPRI) data reveals that China provided 81% of Pakistan's arms purchases from 2019 to 2023. Chinese arms exports to Pakistan reached $5.28 billion, constituting 63% of Pakistan's total defence acquisitions during this period.
The swift decline in defence stock values indicates the market's previous incorporation of war-related premiums and their subsequent elimination. The initial increase reflected investors' anticipation of enhanced Chinese defence exports to Pakistan, considering their strategic partnership through the $60 billion China-Pakistan Economic Corridor (CPEC), a significant Belt and Road Initiative venture incorporating Chinese security provisions.
Stay informed with the latest
business
news, updates on
bank holidays
and
public holidays
.
AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Print
33 minutes ago
- The Print
Op Sindoor is the first battle in India's two-front war. A vicious pawn in a King's Gambit
For once, I would avoid the temptation of the usual trope, a cricketing analogy. I'd leapfrog to chess instead. Since the Pakistanis started this with Pahalgam and fought with Chinese equipment, technology and guidance, think of them as holding the white pieces. And since the side with the white pieces makes the opening move, see this as that familiar move called PK4 in the past, and e4 now. I would, however, suggest a description, if not a sharp, hashtag-worthy name. What we've seen just now is the opening move in a two-front war. You could call it a trailer. It's just the early moves in a long-drawn war of wits, nerve, and military muscle. How do I explain this more succinctly? History gives every war a name. Officially, there's a pause, but the fighting lasted about 87 hours. Will it suffice for future generations for it to be listed merely as the 87-hour war? This means moving the pawn in front of the king two squares ahead, inviting the rival to counter the move. This move can lead to several different strategies, some as exotic sounding as The Italian Game, Scotch Game and Ruy Lopez. The description I find more suitable is The King's Gambit, since it's more aggressive and can lead to multiple tactical options. The two of them, Pakistan and China, are playing this together. And they have moved a pawn forward. Pakistan is in the front, the pawn, powered by the king and the queen, their cavalry and counsels in the back, read China. They wait for India's move now. Complacency is no plan. The clock is running. The flurry of stories (in the newspapers; you'd never catch us citing any TV channel on this) inform us that now the armed forces have also been following the practice of setting up a 'Red Team,' a group of sharp officers tasked with thinking and responding like the enemy. Think for a moment like your Red Team. What will it do next? Our basic premise is that while we have fretted over our two-front predicament, we never really thought it would come to pass at the same time. In 1962, the Pakistanis stayed out, although not unconditionally. They demanded negotiations on Kashmir which duly began under US-British pressure. And in 1965 and 1971, Kargil and onwards, the Chinese mostly kept away. This first move of the pawn two squares ahead of the king shows this has now changed. Also Read: Asim Munir just stole his 5th star & has nothing to show for it. It'll make him desperate, dangerous A two-front war is on. Except, the Chinese see no need to fight it directly. They have an able and willing proxy in Pakistan. They will keep selling it enough cutting-edge hardware to keep it on a par with India if not ahead in some specific areas, like possibly 5th-generation fighters within a year. Their satellites and other ISR (intelligence, surveillance, reconnaissance) resources will be at their ward's disposal, and real-time advice on tap. That's the reason I had said two weeks ago that the next provocation from Pakistan may not take the usual five-six years. It is likely to come earlier, before the field marshal begins to lose his political capital. Logically, the Red Team will conclude that China no longer has any need to fight India directly. All it needs to do is keep equipping Pakistan adequately to do it on its behalf. If you read any coverage of Operation Sindoor, an important strategic pointer jumps out at you. In the entire series of exchanges, you never heard of any American equipment being used, not even the F-16s. The Swedish SAAB Erieye AEW&C (Airborne Early Warning & Control) aircraft are bristling with Chinese electronics. See it as China versus India, but with the Pakistani military in front. For decades, we have known that the Chinese use Pakistan as a cheap instrument to triangulate us between them. This strategy has now moved two steps ahead. The first was the Chinese moving up to eastern Ladakh and tying down a significant section of our strike forces usually earmarked for Pakistan. The second is the direct military challenge from Pakistan. India's aggressive response to this PK4 or e4 move set the two partners back. They might have believed, as CDS Gen Anil Chauhan said in his Pune lecture, that their rocket/missile assault beginning the night of 9/10 May would 'bring India to its knees'. Once this gambit failed with almost all projectiles intercepted and the withering Indian response had the PAF grounded and its bases mauled, ceasefire was the wise option. The Red Team is now thinking what went wrong, and how to prepare for the next round. Also Read: There's an all-new N-word now. And India's soft power has become its hard liability The four things they will worry about: India's multi-layer air defence led by S-400, BrahMos missiles, especially when launched by Su-30MKIs from a distance way out of reach of any PAF missiles, the inadequacy of their own air defences including Chinese HQ-9s and India's ability to suppress or destroy these using its anti-radiation drones. Be sure the Chinese are working with the Pakistanis to address these. They have the S-400 too and boy, can they reverse-engineer. They will try to encash some IOUs with the Russians to find an answer to the BrahMos. A next generation fighter, the FC-31 with a longer-range missile will be on its way soon. I am only wargaming the Red Team. It's safer to presume that China now sees Pakistan as an extension of their India-focused Western Theatre Command. I would go so far as to say that the Chinese PLA would see Pakistan as their newest, the sixth theatre command. If it keeps India bogged down, their own Western Theatre Command can chill. There are several books and academic papers written on Pakistan-China relations. For our limited purpose we only need to run our eyes backwards over some important dates. The India-China border situation deteriorates after the Zhou Enlai visit in 1960. On 28 March, 1961, Pakistan sends a note to China seeking a demarcation of their boundary, which they only share by virtue of their illegal occupation over a part of Kashmir. In February 1962, as the crisis with India is heating up, Sir Muhammed Zafrullah Khan, speaking for Pakistan at the UN, admits that Islamabad is committed to withdrawing its forces from its borders with China in PoK. Two months later, on 3 May, the two issue a joint communique to start negotiations. India meanwhile keeps protesting. On 12 October, Pakistan and China have direct negotiations on border demarcation. Eight days later, Chinese PLA begins its attack. This is moving at warp speed. Just four months after the India-China fighting stops, Pakistan foreign minister Zulfikar Ali Bhutto makes a dramatic visit to Beijing where a landmark agreement is signed which involves the ceding of 5,180 sq km of PoK territory (Shaksgam Valley and around) to China while getting some grazing grounds across Hunza in return. India of course rejects this. This super-short 150-word history explains the single-pylon China-Pakistan relationship. The shared hostility to India is the solitary pylon. The Pakistan-China embrace came even though one was a formal US, anti-Communism ally and the other still a 'brother' of the Soviet Union. This deal has strengthened over the intervening six decades. The difference now is that China is the world's second superpower and India is much stronger too. That's why China and Pakistan need each other more than they did in the 1960s. And if the Chinese can enable the Pakistanis to fight India as their proxies, it is value for money. We've only seen the first moves in this game yet. Also Read: What is Asim Munir thinking?
Economic Times
an hour ago
- Economic Times
Donald Trump says China's Xi Jinping agreed to let rare earth minerals flow to US
NYT News Service FILE - President Donald Trump meets with President Xi Jinping of China at the G20 Summit in Osaka, Japan, June 29, 2019. China and the United States on June 5, 2025 agreed to hold more trade talks in hopes of breaking an impasse over tariffs and global supplies of rare earth minerals, a move that came after Trump and Xi spoke by phone. (Erin Schaff/The New York Times) U.S. President Donald Trump said on Friday that Chinese President Xi Jinping agreed to let rare earth minerals and magnets flow to the United States, a move that could lower tensions between the world's biggest economies. Asked by a reporter aboard Air Force One whether Xi had agreed to do so, Trump replied: "Yes, he did." The Chinese embassy in Washington did not immediately respond to a request for comment. Trump's comment came one day after a rare call with Xi aimed at resolving trade tensions that have been brewing over the topic for weeks. At that time, Trump said there had been "a very positive conclusion" to the talks, adding that "there should no longer be any questions respecting the complexity of Rare Earth products." In another sign of easing tensions over the issue, China has granted temporary export licenses to rare-earth suppliers of the top three U.S. automakers, two sources familiar with the matter said. The U.S. president's top aides are set to meet their Chinese counterparts in London on Monday for further talks. "We're very far advanced on the China deal," Trump told reporters on Friday. The countries struck an agreement on May 12 in Geneva, Switzerland, to roll back for 90 days most of the triple-digit, tit-for-tat tariffs they had placed on each other since Trump's January inauguration. Financial markets that had worried about trade disruptions rallied on the news. But China's decision in April to suspend exports of a wide range of critical minerals and magnets has continued to disrupt supplies needed by automakers, computer chip manufacturers and military contractors around the world. Trump had accused China of violating the Geneva agreement and ordered curbs on chip-design software and other shipments to China. Beijing rejected the claim and threatened counter measures. Rare earths and other critical minerals are a source of leverage for China as Trump could come under domestic political pressure if economic growth sags because companies cannot make mineral-powered products. Since returning to the White House in January, Trump has repeatedly threatened an array of punitive measures on trading partners, only to revoke some of them at the last minute. The on-again, off-again approach has baffled world leaders and spooked business executives.
Time of India
an hour ago
- Time of India
Donald Trump says China's Xi Jinping agreed to let rare earth minerals flow to US
U.S. President Donald Trump said on Friday that Chinese President Xi Jinping agreed to let rare earth minerals and magnets flow to the United States, a move that could lower tensions between the world's biggest economies. Asked by a reporter aboard Air Force One whether Xi had agreed to do so, Trump replied: "Yes, he did." The Chinese embassy in Washington did not immediately respond to a request for comment. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo Trump's comment came one day after a rare call with Xi aimed at resolving trade tensions that have been brewing over the topic for weeks. At that time, Trump said there had been "a very positive conclusion" to the talks, adding that "there should no longer be any questions respecting the complexity of Rare Earth products." Live Events In another sign of easing tensions over the issue, China has granted temporary export licenses to rare-earth suppliers of the top three U.S. automakers, two sources familiar with the matter said. The U.S. president's top aides are set to meet their Chinese counterparts in London on Monday for further talks. "We're very far advanced on the China deal," Trump told reporters on Friday. The countries struck an agreement on May 12 in Geneva, Switzerland, to roll back for 90 days most of the triple-digit, tit-for-tat tariffs they had placed on each other since Trump's January inauguration. Financial markets that had worried about trade disruptions rallied on the news. But China's decision in April to suspend exports of a wide range of critical minerals and magnets has continued to disrupt supplies needed by automakers, computer chip manufacturers and military contractors around the world. Trump had accused China of violating the Geneva agreement and ordered curbs on chip-design software and other shipments to China. Beijing rejected the claim and threatened counter measures. Rare earths and other critical minerals are a source of leverage for China as Trump could come under domestic political pressure if economic growth sags because companies cannot make mineral-powered products. Since returning to the White House in January, Trump has repeatedly threatened an array of punitive measures on trading partners, only to revoke some of them at the last minute. The on-again, off-again approach has baffled world leaders and spooked business executives.
