SHARES in Cathay Pacific Airways and majority owner Swire Pacific fell for the third straight day yesterday, with analysts blaming continued investor uncertainty over the airline's future as the territory's de facto flag carrier.
Both featured on the top 10 list of worst performers by percentage change on the Hang Seng Index, with Swire's 3.81 per cent drop leading the pack.
Swire closed the day $2 down, at $50.50, while shares in Cathay Pacific closed at $10.60, a 3.2 per cent drop.
Analysts said a report in the South China Morning Post yesterday, which described an internal memo to staff from chairman Peter Sutch saying the implications of a Chinese company's application to operate flights from the territory go 'well beyond our own interests and those in the aviation community of Hong Kong', had pushed the stock down.
The latest edition of Cathay's in-house newspaper The Weekly, to be published today, will expand on the remarks, a Swire spokesman said.
Cathay stock fell 5.96 per cent in morning trading and was down 70 in the afternoon - a 6.4 per cent plunge - before finishing the day down 35.
The Civil Aviation Department on Monday revealed that the China National Aviation Corporation (CNAC), which is controlled by the mainland's aviation regulator, had applied for an air operators' certificate and it intended to start an airline to compete directly with Cathay.