Avic Chengdu Share Price Tumbles Over 11% as Modi's Message Sparks Global Market Turmoil

The share price of Chinese defence company Avic Chengdu Aircraft plummeted by over 11% in three days following Prime Minister Narendra Modi's strong-worded message on the successful completion of Operation Sindoor. The Indian Prime Minister warned Pakistan that India would not succumb to nuclear blackmail, sending a clear signal to the world about the country's resolve against terrorism.

The message triggered a heavy selloff on the global market, with Avic Chengdu Aircraft shares opening the day at 87.88 yuan per share and touching an intraday low of 85 yuan per share, logging a loss of nearly 6%. The Chinese defence stock has declined by over 11.50% since Monday's close of 95.86 yuan per share.

However, just last week, Avic Chengdu Aircraft shares surged over 60% following the launch of Operation Sindoor on May 6. The sudden turnaround in sentiment has led many analysts to scramble for explanations.

"This is a classic case of profit-taking after a sharp rally," said Ganesh Dongre, Senior Manager — Technical Research at Anand Rathi. "The stock has broken out of its base and surged quickly, but since then, it's been selling off heavily due to concerns over the implications of Operation Sindoor."

Dongre believes that Avic Chengdu Aircraft is currently in an overbought zone on the weekly chart, indicating limited upside potential for the near term. He advises traders to avoid fresh entries at current levels and consider buying on dips closer to the support range for a more favourable risk-reward setup.

Anshul Jain, Head of Research at Lakshmishree Investment, also sees a pullback in the stock as a buying opportunity if it shows signs of stability and renewed demand. "Traders should closely watch price action near 73 Yuan per share, as this could lead to a potential reversal setup with defined risk," he added.

The global market reaction to Modi's message has sparked interest among investors, as the Indian Prime Minister hails the country's air defence system and sends a clear message about the limits of Pakistan's nuclear blackmail.