China Eastern’s market rally lifts Chinese travel brands
China Eastern rallied to a three-week high in New York on its plans to add six jets to its fleet a day after forecasting a 263-fold increase in first-quarter profit..
China Eastern Airlines Corp. rallied to a three-week high in New York as the company plans to add six jets to its fleet a day after forecasting a 263-fold increase in first-quarter profit.
The American depositary receipts jumped 9.7 percent to $41.66. Its bigger peer China Southern Airlines Co. gained 5.7 percent. Online package tour service Tuniu Corp. advanced the most in five weeks. China Lodging Group Ltd., a budget hotel chain, climbed to a two-week high. A Bloomberg gauge of the most-traded Chinese companies trading in the U.S. rose 2.4 percent.
China Eastern, the second-largest domestic airline, entered an agreement to lease six Airbus A320 jets on Thursday, after saying the previous day that it may report as much as 3.7 billion yuan ($600 million) of net income for the first half, according to regulatory filings. The carrier had a profit of 14 million yuan during the same period in 2014. It attributed the increase to lower oil prices and rising customer demand. China’s SWS Research raised its 2015 earnings estimate for the carrier by 38 percent.
The company’s guidance “comes in higher than our earlier expectation,” SWS analyst Wu Yifan wrote in a research note Thursday. “We see the data as pointing to positive industry conditions.”
The profit guidance for the first quarter was about 60 percent of the average full-year projection of 14 analysts surveyed by Bloomberg.
China Southern, the nation’s largest air carrier, advanced to $53.77. Tuniu rallied to $16.26, gaining the most since June 11. China Lodging rose 4.9 percent to $23.37. The Bloomberg China-U.S. Index for ADRs climbed to 124.41.
The Deutsche X-trackers A-Shares ETF added 4.7 percent to $42.11 in New York, rising for the first time this week. The iShares China Large-Cap ETF tracking Hong Kong shares increased 1.9 percent to $42.54.
Read original article