Aviation shares in demand; Jet Airways gains over 10%

So far in October, Spicejet surged 22%, while Jet Airways up 19% after OMCs reduced the price of ATF.

Shares of aviation companies like Jet Airways (India) and Spicejet have rallied by up to 9% in otherwise weak market on back of heavy volumes on the bourses.

Jet Airways (India) has soared nearly 11% to Rs 246 on NSE on back of two-fold jump in trading volumes. A combined 2.8 million shares changed hands on the counter so far on NSE and BSE.

Spicejet has surged nearly 9% to Rs 14.99 on BSE. The counter has seen huge trading volumes with 5.1 million shares changed hands till 1510 hours against an average sub 2 million shares that were traded daily on BSE.

S&P BSE Sensex was down 1.3% or 352 points at 26,285 at 1520 hours.

So far in October, Spicejet surged 22%, while Jet Airways up 19% after state-owned oil companies reduced the price of aviation turbine fuel (ATF) or jet fuel by a steep 3% on the back of falling international oil rates, bringing relief to airlines.

Domestic airlines expect the fall in prices of aviation fuel to boost their earnings from the quarter ending December.

Jet fuel constitutes over 40% of an airline's operating cost and the reduction in prices will ease the burden of the cash-strapped airlines.

On Thursday, oil prices sank to more than two-year lows as weak economic data from Germany underscored concerns over a global economic slowdown and its impact on energy demand, analysts said, AFP/PTI report suggests.