Shares of Chengdu Aircraft Corporation (CAC), the Chinese aerospace company behind the J-10 fighter jet, surged by 20% on May 12, 2025, amid reports of a Rafale jet being downed during recent India-Pakistan air clashes. This marked a significant rise in investor confidence for CAC, with its stock reaching CNY 95.86, a 60% increase from the previous week.
This uptick follows reports confirming that the Indian Air Force lost several aircraft, including a Rafale jet, in the ongoing military confrontations between India and Pakistan. Investors are reacting to the growing perception of CAC’s defense capabilities, especially amid rising tensions in the region.
In contrast, French aerospace giant Dassault Aviation, manufacturer of the Rafale, saw its stock fall. On May 9, 2025, Dassault shares closed at EUR 314.6, down from EUR 325.8 on May 5, marking a decline of about 3.44%. This drop follows the Indian Air Force’s acknowledgment of losses, including the Rafale jets, during these clashes.
The increased scrutiny of military hardware performance, particularly the Rafale’s vulnerability in combat, is affecting stock performance in the defense sector. Analysts and investors are closely watching these developments to assess the longer-term impact on aerospace stocks and regional security dynamics.
As the situation continues to unfold, CAC’s rise in stock value highlights shifting investor sentiment toward Chinese defense manufacturers, while Dassault Aviation faces pressure following the recent losses.
