Following Operation Sindoor, a rare joint strike by the Indian Army, Navy, and Air Force on terror camps in Pakistan and Pakistan-occupied Kashmir (PoK), defense stocks in China—Pakistan’s key military supplier—saw a strong rally.
The operation, launched around 1:44 am on May 7, marks the first coordinated military action by all three Indian forces on foreign soil since the 1971 war. It came just two weeks after a deadly terror attack in Pahalgam, Jammu & Kashmir, where 26 civilians, including a Nepali national, were killed—most of them tourists. India had promised a strong response, and this operation is seen as delivering on that pledge.
In reaction to the rising tensions, defense stocks in the Hong Kong stock market surged:
CSSC Defence rose nearly 9%
AVIC Industry gained over 7%
Aerospace Holdings climbed by 5%
China Aviation Technology Holdings went up nearly 3%
Chengdu Aircraft Corporation (CAC), makers of J-10 and JF-17 jets used by the Pakistan Air Force, saw its shares jump by 11%.
The stock rally reflects investor expectations of increased defense demand amid growing military tensions in the region.
