Cathay Pacific reports that a limited number of flights are affected by an issue with Rolls-Royce A350 engine.

• Cathay Pacific announced that the issues identified in Rolls-Royce's Trent XWB-97 engines could be resolved by Sept. 7, causing Rolls-Royce shares to rise on Tuesday morning.
• This week, 15 Cathay Pacific A350 aircraft, which use Rolls-Royce engines, experienced engine component failures, causing Rolls-Royce shares to fall on Monday.
• This week, numerous Cathay Pacific flights will be cancelled owing to the problem.

On Tuesday, shares rose, partially offsetting the losses from the previous session, after several flights were cancelled due to technical problems with aircraft equipped with Trent XWB-97 engines made by the British manufacturer.

Rolls-Royce shares rose 3.1% following a 6.5% decline on Monday.

On Tuesday, Cathay Pacific announced that 15 of its Airbus A350 aircraft, which are long-range, wide-body planes that use Rolls-Royce engines and are operated by multiple carriers including Qatar Airways, British Airways, and Virgin Atlantic, had experienced an engine component failure.

Cathay Pacific has a total of 48 A350s in its fleet.

A Zurich-bound flight operated by the carrier from its base in Hong Kong on Sept. 2 experienced an engine component failure, resulting in the plane not completing its journey and returning to Hong Kong.

By Sept. 7, the airline expects to resume operations with all aircraft repaired, as three have already been successfully fixed.

Nearly 40 flights on Asian routes were canceled on Monday due to an issue, but long-haul flights are not expected to be affected in the future, and customers will be given alternative options, Cathay Pacific stated.

The company announced that details on cancellations up to Sept. 7 will be released by 2 p.m. local time on Wednesday.

Rolls-Royce on Tuesday confirmed that its Trent XWB-97 engine was used in the aircraft. However, Hong Kong authorities have launched an investigation, which has restricted the company's ability to comment. Despite this, Rolls-Royce is committed to working closely with the airline, aircraft manufacturer, and relevant authorities to support their efforts.

The airline will inform other airlines that operate Trent XWB-97 engines of any relevant developments.

The current engine problems at Rolls-Royce, Pratt & Whitney, and Boeing have heightened investors' concerns, given the previous issues with Rolls-Royce's Trent 1000 engines and the significant delays caused by engine issues at Pratt & Whitney, which affected Airbus deliveries of some aircraft.

The latest engine issue with Cathay Pacific and Rolls-Royce remains unclear.

Morgan Stanley analysts stated in a Monday evening note that the grounded aircraft's plan to remain out of service for several days implies that the issue is minor and can be resolved quickly, and therefore does not affect the engine's design or architecture as seen with the Trent 1000. They added that the situation is still in the discovery phase.

For years, Rolls-Royce's Trent 1000 engines faced challenges due to corrosion-related cracks, resulting in a financial loss of more than £2 billion ($2.62 billion).

Despite some concerns raised by the news, our initial assessment suggests that the financial liability can be managed. As a result, our outlook on Rolls-Royce's equity story remains positive, according to Deutsche Bank analysts on Tuesday.

In recent years, Rolls-Royce stock has experienced significant fluctuations, with a significant decline during the pandemic due to supply chain problems and reduced aviation demand. However, in 2023, the company's stock price surged more than 220% after implementing a major restructuring and efficiency program that improved profitability.

- CNBC's Ganesh Rao contributed to this story.