Evergrande's last-gasp interest payment gives Chinese developer stocks and Asia bonds a lift

Asia's Tech News Daily

Evergrande's last-gasp interest payment gives Chinese developer stocks and Asia bonds a lift
© Marc Fernandes/NurPhoto via Getty Images Marc Fernandes/NurPhoto via Getty Images

  • Evergrande’s surprise payment on a missed dollar bond coupon lifted regional property stocks and bonds on Friday.
  • The Chinese developer’s shares rose as much as 7.8%, before closing 4.2% higher.
  • Hong Kong’s property developer index rose 3.3%, notching its biggest weekly gain in a month.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

A surprise interest payment from Evergrande has lifted Chinese property stocks and risk-sensitive assets including junk bonds on Friday, as the last-minute payment eased a period of uncertainty for investors.

The embattled developer wired $83.5 million to pay the interest on an offshore dollar bond on Thursday ahead of a closely-watched deadline that expires Saturday, state-backed media reported.

Evergrande’s shares rose as much as 7.8% in Hong Kong on Friday, putting it on track for its first rise since late September when it had raised $1.5 billion by selling part of its stake in a Chinese lender. Its stock closed 4.2% higher on Friday.

Hong Kong’s Hang Seng mainland property index rose 3.3%, closing up nearly 8.5% in a week, its biggest weekly gain in a month. The broader Hang Seng index gained 0.4%. The Shanghai Property Index has risen 4.7% in two days, which is the most in seven weeks, according to Bloomberg data.

Evergrande’s dollar bonds jumped, with its April 2022 and 2023 notes rising more than 10% in price on Friday, the Guardian reported, citing data from Duration Finance.

Regional high-yield junk bonds rose in price too. In China, they rose as much as 3 cents on the dollar, Bloomberg reported, citing credit traders. That leaves them 4.5 cents higher this week – the biggest weekly gain since 2012.

Evergrande didn’t provide an announcement about the implications of the payment, or what this means for the group’s future.

But the company broke its silence on its payments after a deal to sell a $2.6 billion stake in a key unit to Hopson Development failed this week. In a Wednesday filing, the group said there has been “no material progress on sale of assets.”

It also noted Evergrande “has a 30-day grace period to pay interest after the interest becomes due under its US dollar-denominated notes” and these grace periods “have not expired.”

One explanation for Thursday’s repayment is that Evergrande may not want to default after China’s move to stabilize the property sector, according to Nomura. “As the property management deal has failed, they may want to buy more time to retain the flexibility to sell assets before they are locked up by creditors,” Nomura said.

But the investment firm said it views an Evergrande default as “almost inevitable,” and that it’s better for the company to default earlier rather than later to prevent repayment of onshore debt using offshore assets.

Another property developer Kaisa, which is also being closely watched, has a bond interest payment due on Friday. That bond last traded at 35 cents on the dollar, according to the Financial Times.

Real estate companies in the region also reportedly got a boost from China pledging to support those buying homes for the first time with easier mortgage financing.

Seazen Group and Sunac China rose 8% in Hong Kong. China Vanke, the nation’s third-biggest developer, gained 2.8% in Hong Kong, while its Shenzhen-listed shares rose 2.9%. The best performer, Tianjin Jinbin Development, jumped 10% in Shenzhen.

Read the original article on Business Insider

Internet Explorer Channel Network
Asia's Tech News Daily
News Related

OTHER NEWS

Pence aide Marc Short cooperating with the House January 6 committee

© Provided by Daily Mail MailOnline logo Marc Short, a top aide to former Vice President Mike Pence, is cooperating with the House’s January 6 select committee.  CNN first reported ... Read more »

Corrie spoiler: Emma to suffer wedding heartbreak as Curtis considers fleeing Weatherfield

Coronation Street’s Emma Brooker could be set for more heartbreak at her festive wedding as Curtis Delemare considers fleeing. The couple have had a tough few weeks – but things ... Read more »

Endangered right whale gives birth while entangled in fishing rope

Scientists spotted an endangered right whale dragging a length of fishing rope caught in its mouth as it swam with a newborn calf off the Georgia, US, coast, a rare ... Read more »

Justice Department closes Emmett Till lynching investigation without new charges

© Copyright 2018 The Associated Press. All rights reserved. Emmett Till-Investigation – Copyright 2018 The Associated Press. All rights reserved. The Department of Justice has closed its re-investigation of the ... Read more »

Business secretary accused of ‘running away' from Commons as thousands face 11th night without power

© Getty Images Soldiers carry out welfare checks at a remote property that remains without power in County Durham – Getty Images Labour’s Ed Miliband has accused the business secretary ... Read more »

This is the hidden cost of Trumpism

By any measure, Charlie Baker is one of the most popular governors in the country. © Omar Rawlings/Getty Images In 2018, he won reelection as Massachusetts’ chief executive with 67% ... Read more »

‘Blink twice if you need help': Harris aide mocked for ‘love' of job tweet amid turmoil

David Gins, an aide to Vice President Kamala Harris, shared that he loves his job on Twitter. Twitter An aide to Vice President Kamala Harris responded to the exodus of ... Read more »

'Succession' star Jeremy Strong asked Chris Evans for help finding an agent early in his career

© Provided by INSIDER Jeremy Strong and Chris Evans went to high school together. Alberto E. Rodriguez/Getty Images; Mike Windle/Getty Images Chris Evans and Jeremy Strong went to high school ... Read more »

Kadeena Cox leaves I'm a Celebrity...Get Me Out of Here!

© Bang Showbiz Kadeena Cox has left I’m a Celebrity Kadeena Cox has been voted out of the ‘I’m a Celebrity…Get Me Out of Here!’ castle. The 30-year-old Paralympian has ... Read more »

Kevin Feige confirms Charlie Cox will return as Daredevil

Marvel’s president Kevin Feige has confirmed that Charlie Cox will return to play the role of Matt Murdock, aka Daredevil in future films. During the press tour for Spider-Man: No ... Read more »

Child deaths fell 10% during first year of pandemic

Photograph: Thomas Barwick/Getty Images Child deaths in England fell by about 10% during the first year of the coronavirus pandemic to what could be a record low, according to the ... Read more »

Storm Barra to batter UK with disruptive winds, heavy rain and snow

Storm Barra will hit the UK and Ireland with disruptive winds, heavy rain and snow on Tuesday, according to the Met Office – threatening more chaos as some households continue ... Read more »

Myanmar court sentences ousted leader Aung San Suu Kyi to 4 years

Myanmar Suu Kyi Verdict (Copyright 2021 The Associated Press. All rights reserved) A court in Myanmar sentenced the country’s ousted leader, Aung San Suu Kyi, to four years in prison ... Read more »

New rules for travellers aim to slow down transmission of Omicron

New rules designed to slow the spread of the Omicron variant of coronavirus will see travellers having to take a pre-departure test before travelling to England from Tuesday. All travellers ... Read more »

Strong winds could affect traffic at Confederation Bridge

© Confederation Bridge CBC meteorologist Jay Scotland said southerly winds could range from 50 to 80 km/h overnight. Strong winds may cause some ferry service and Confederation Bridge traffic disruptions ... Read more »

Calgary Transit fares increase as ridership struggles to rebound

It will cost Calgarians a bit more to ride on the city’s transit network as fares are set to increase this year. © Global News Calgary Transit is currently operating ... Read more »

Canadian traveller forced to stay in quarantine facility after negative COVID-19 test

Lennard Skead says he felt like he’d been put in jail for a crime he didn’t commit when he returned to Canada from South Africa on Thursday. © Provided by ... Read more »

Joe Judge needs to show more than empty positive spin

When your team can’t win and your team can’t score and your team is boring and the games largely take on familiar terribleness and there is scorn and derision and ... Read more »

Teenager faces intoxication assault charge in accident that injured one person in Haltom City

An 18-year-old is in police custody after Haltom City police said he caused multiple car crashes, sending himself and one other person to the hospital, while suspected of driving drunk ... Read more »

UK travel firms call for state help after Omicron hits turnover

Photograph: Nathan Stirk/Getty Images Industry body warns that some operators won’t last the winter after return of strict Covid travel rules Travel firms have called on the government to provide ... Read more »

Alibaba Replaces CFO, Reshuffles Commerce Heads

Chinese e-commerce giant Alibaba Group Holding Ltd. is replacing its chief financial officer and reshuffling the leaders of its commerce businesses. Shiyin Chen reports on “Bloomberg Markets: Asia.” Read more »

Olivia Colman segues from royalty to convicted killer in ‘Landscapers'

There’s a lot going on in “Landscapers,” which sets a real-life double-murder case in England against a backdrop of whimsy and comedy both light and dark offset by fantasy sequences. ... Read more »

Yellowstone: 6666 Release Date, Cast, And Plot - What We Know So Far

Paramount Network/YouTube On the other side of just four seasons of the (now) Emmy-nominated “Yellowstone,” series creator Taylor Sheridan is fast becoming to the contemporary Western what executive producer Dick ... Read more »

Big changes to holidays coming tomorrow – everything you need to know about Covid travel tests and the red list

FROM 4am tomorrow, travellers aged 12 and over coming into the UK will need to take a pre-departure Covid test. The government announced the new rule at the weekend, as ... Read more »

My husband killed our twins after leaving them in hot car for eight hours by mistake – but I FORGAVE him

A GRIEVING mum has admitted she has forgiven her husband after he accidentally killed their twins by leaving them in a hot car for eight hours. Marissa Rodriguez has described ... Read more »

Earth to White House: Idiotic Ron Klain claims press is tougher on Biden than Trump

President Biden’s chief of staff Ron Klain believes the media is being too harsh on his boss. UPI In a sign of just how detached from reality this White House ... Read more »

PIC: Hardik Pandya's adorable moment with son Agastya will make you go 'aww'

The audience is always interested in getting sneak peeks of celebrities’ personal lives and their families. When it comes to families, certain parent-child duos are extremely loved by fans. One ... Read more »

David Tennant questions Tory focus on ‘Britishness' of TV shows

Photograph: Tudor Cucu/BBC Actor asks whether idea means ‘made in Britain’ – or insisting on a ‘certain political viewpoint’ David Tennant has criticised the suggestion by the former media minister ... Read more »

Justice Department closes Emmett Till investigation, report says

The Department of Justice has reportedly concluded its investigation into the 1955 killing of teenager Emmett Till, who was accused by a white Mississippi shop owner of making advances on ... Read more »

Whistleblower condemns Foreign Office over Kabul evacuation

Photograph: Akhter Gulfam/EPA Ex-diplomat claims string of failings within department led to ‘people being left to die at the hands of the Taliban’ Tens of thousands of Afghans were unable ... Read more »

Fresh questions raised about Dominic Raab's role in Afghan rescue debacle

Analysis: most damning of claims refer to period when Raab was in direct control of evacuation – after his return from holiday The extraordinary claims in the testimony from a ... Read more »

Tesco slashes Baileys 1litre bottles to £9.50 – and it's the cheapest price ever

TESCO has slashed the price of 1litre bottles of Bailey's to its cheapest price ever of £9.50 as supermarkets ramp up the boozy price war. Shoppers will be able to ... Read more »

UK's top 20 Christmas cracker jokes – including why Boris Johnson is bad at Scrabble & a very cheeky Matt Hancock gag

FROM naughty elves being “given the sack” to a scared Santa being branded “Claustrophobic”, we’ve heard them all.  Up to 154 million Christmas crackers are pulled in the UK every ... Read more »

I love Christmas so much that I start drinking at 6.30am, reveals Gregg Wallace

MASTERCHEF star Gregg Wallace has revealed he starts drinking at 6.30am on Christmas Day. The judge on the BBC1 cookery show later joins his ­Italian wife and in-laws in polishing ... Read more »

Nic Claxton's return to Nets could be just what James Harden needs

James Harden often looked like the Harden of old. He could beat Chicago defenders off the dribble and toy with them, keeping them on his hip. He consistently drove into ... Read more »

Blake Shelton says Gwen Stefani wedding was his 'greatest gig'

Blake Shelton’s wedding to Gwen Stefani was the “greatest gig” of his life. © Bang Showbiz Blake Shelton’s wedding was his greatest gig The 45-year-old country music star and Gwen, ... Read more »

Cardi B hails her 'sexy and tasty' Whipshots

Cardi B loves her “sexy and tasty” Whipshots. © Bang Showbiz Cardi B’s Whipshots are proving popular The chart-topping rap star recently launched her new brand – a vodka-infused whipped ... Read more »

Leaders of four European states and US call for resumption of Normandy format

France, Germany, Italy, the UK and the US the sides reiterated the need to resume negotiations between Russia and Ukraine as part of the Normandy Format Read more »

Alabama Gov. Ivey facing new challenger in 2022 GOP primary

© Provided by Associated Press FILE – Former gubernatorial candidate Tim James speaks to reporters during a news conference, Sept. 15, 2021 on the steps of the Alabama Capitol in ... Read more »

Epstein ‘wired more than 30 million dollars to Maxwell over eight years'

British socialite Ghislaine Maxwell received more than 30 million US dollars (£22.6 million) from disgraced financier Jeffrey Epstein over a period of eight years, a court has heard. Documents presented ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic