Shares in AirAsia closed 7.8 per cent down yesterday after the disappearance of flight QZ8501 on its way from Surabaya in Indonesia to Singapore.
The fall is its largest single-day drop since September 2011.
AirAsia was the most active stock on the Kuala Lumpur Stock Exchange, with 59.5 million shares traded during the day. That's about 5.2 times its average volume over the past month.
However, shares in the airline have gained more than 20 per cent since the start of 2014.
Global airline shares are traditionally vulnerable to skittish investors during air disasters, but UK airlines fared well as the markets opened for their first day of post-Christmas trading.
Shares in International Consolidated Airlines Group (IAG), British Airways' parent company, edged up 0.15 per cent in early trading, while EasyJet shares rose 0.19 per cent.
Meanwhile, rescuers searching for debris in the Java sea, where the plane is thought to have gone down, said they had spotted "suspicious objects" near Nangka island, about 700 miles from where the plane lost contact.
Yesterday, FH Bambang Soelistyo, chief of Indonesia's National Search and Rescue Agency, said that "based on the co-ordinates given to us and evaluation that the estimated crash position is in the sea, the hypothesis is the aircraft is at the bottom of the sea".