Hong Kong leads equity sell-off as Evergrande fears spread

Hong Kong leads equity sell-off as Evergrande fears spread

Fears about a contagion from the possible collapse of China Evergrande have sent property firms in Hong Kong plunging.

HONG KONG – Asian markets sank Monday on fears about contagion from a possible collapse of teetering property giant China Evergrande, while sentiment was also dragged by the Federal Reserve's plans to taper monetary policy, surging Delta infections and signs of weakness in the global recovery.

Hong Kong again led the losses with Evergrande due to pay interest on some of its loans and bonds this week, with observers expecting it to default.

Uncertainty about the future of the company, which is drowning in debts of more than $300 billion, has shattered confidence on trading floors, with property companies and banks in Hong Kong taking the brunt of the selling.

Hong Kong shed 4% at one point, with Evergrande down almost 19% briefly while New World Development and Henderson Land each lost more than 10%.

Analyst Philip Tse, of BOCOM International Holdings, warned “there will be further downside” unless leaders give a clear signal on Evergrande or ease up on their clampdown on the real estate sector.

Despite the growing crisis, the government has yet to step in to prevent Evergrande from going under.

Analysts say that while leaders are looking to curb excessive risk-taking, they will probably work to prevent the issue from becoming unmanageable.

“The central government’s priority of social stability makes restructuring likely with haircuts for debt holders, but spillovers to other listed property developers means there will likely be a real economy impact on the real estate sector,” said National Australia Bank’s Tapas Strickland.

“To what extent Evergrande slows the growth momentum remains unclear.”

The selling was mirrored elsewhere in Asia.

Sydney was down more than 2%, with miners also being hammered by a plunge in iron ore prices, while Singapore, Wellington, Mumbai, Manila, Bangkok and Jakarta were also well down. Tokyo, Shanghai, Seoul and Taipei were closed for holidays.

London and Paris opened sharply lower, while Frankfurt’s DAX, which saw an extra 10 firms added to it as part of a revamp, fell 1.6%.

The selling followed another loss on Wall Street, where investors are tracking the progress of Joe Biden’s multi-trillion-dollar spending bills, while there is unease that lawmakers have yet to raise the US debt ceiling, risking the country defaulting on its own obligations.

The Fed’s policy meeting this week is being closely followed, with some experts predicting it could set a timetable for winding in its vast bond-buying programme put in place last year to support the economy and equity markets.

Officials have flagged that they will begin tapering by the end of the year in order to keep a lid on inflation, though it is yet to indicate by how much and from when.

Wednesday’s announcement comes as several other central banks around the world also prepare to make decisions, with many now considering tightening.

The shift towards turning off the taps to financial markets comes as the Delta variant continues to spread quickly around the world, forcing some governments to reimpose lockdowns or other strict containment measures.

Among them is China, where a new outbreak is raising concerns about the effect on the recovery in the world’s number-two economy, a key driver of global growth.

– Key figures around 0810 GMT –

London – FTSE 100: DOWN 0.8% at 6,907.90

Tokyo – Nikkei 225: Closed for a holiday

Shanghai – Composite: Closed for a holiday

Dollar/yen: DOWN at 109.85 yen from 109.97 yen at 2050 GMT on Friday

Euro/dollar: DOWN at $1.1715 from $1.1729

Pound/dollar: DOWN at $1.3695 from $1.3731

Euro/pound: UP at 85.54 pence from 85.40 pence

West Texas Intermediate: DOWN 1.1% at $71.20 per barrel

Brent North Sea crude: DOWN 0.9% at $74.66 per barrel

New York – Dow: DOWN 0.5% at 34,584.88 (close)

Internet Explorer Channel Network
News Related

OTHER NEWS

HGV driver crisis: 'Things are not visibly getting better at this stage'

Industry bosses told a select committee hearing that the crisis could last a year and that it was resulting in "terrifying" price rises for the hospitality sector. Read more »

The NBA arena that plans to end single-use plastic starting this season

Footprint Center exteriorSource: Suns Legacy Partners & Footprint When the Phoenix Suns open the 2021-2022 NBA season at home on Oct. 20, fans will likely notice the new banner hanging ... Read more »

ICICI Securities Q2 PAT up 26% to Rs 351-crore; announces interim dividend of Rs 11.25/share

ICICI Securities on Tuesday reported a 26 per cent jump in profit after tax to Rs 351 crore in the three months ended September 2021 on account of growth in ... Read more »

China's property and construction sectors contract in third quarter as Evergrande crisis and tougher regulation hit home

China’s property and construction sectors contracted in the third quarter for the first time since the start of the pandemic, hurt by a slump in real estate as the Evergrande ... Read more »

Apple is selling this piece of cloth for $19

Apple’s polishing cloth goes for $19. Apple At least it’s cheaper than an iPhone. Apple is now selling a “Polishing Cloth” for $19 — even though similar products go for ... Read more »

Inflation is not going away any time soon. Here's how top financial advisors are handling it

Shoppers at a New York supermarket on Aug. 11, 2021.Wang Ying | Xinhua News Agency | Getty Images One looming question for the U.S. economy is how long inflation is ... Read more »

STI up 0.79%, taking the cue from Wall Street rally

SINGAPORE (THE BUSINESS TIMES) – Overnight Wall Street indexes rallied and gave the Straits Times Index (STI) and key regional barometers reasons to be bullish on Tuesday. The STI rose ... Read more »

Sembcorp Marine expects significant H2 loss with supply chain crunch

SINGAPORE (THE BUSINESS TIMES) – Sembcorp Marine (Sembmarine) expects to post “significant losses” in H2 ending Dec 31, 2021, potentially in the range of the S$647 million loss in the ... Read more »

Brussels kicks off debate on EU countries' budget rules: unity is hard to find

The fiscal rules, officially the Stability and Growth Pact (SGP), are mainly known for the limits on the national debt (maximum 60% of gross domestic product) and the budget deficit ... Read more »

Rallis India consolidated Q2 PAT down 32.53% at Rs 56 crore

Representative Image Rallis India, a Tata group company, on Tuesday reported a 32.53 per cent decline in consolidated profit after tax (after exceptional items) during the quarter ending September 30, ... Read more »

Wall Street start higher; J&J leads gains for health care sector

Source: Reuters Stocks are moving modestly higher on Wall Street in early trading Tuesday as corporate earnings reporting gets into full swing. The benchmark S&P 500 was up 0.3% in ... Read more »

Morgan Stanley says SpaceX's Starship may 'transform investor expectations' about space

Starship prototype 20 is stacked on top of Super Heavy Booster 4 on August 6, 2021.SpaceX Elon Musk's SpaceX has become one of the world's most valuable private companies, and ... Read more »

Gold prices climb above Rs 47,500/10 gm on positive global trend, weaker dollar

Gold prices soared above Rs 47,500 per 10 gram on October 19 tracking firm global trend and feeble dollar. The precious metal is trading above $1,780/oz levels breaching the intraday ... Read more »

Stock Blog: Higher Starts on Wall Street; AEX flirts with 800 points

Wall Street will start higher on Tuesday. Johnson & Johnson is in good shape, while Procter & Gabler has to give up ground. AEX is just below 800 points in ... Read more »

HUL's Q2 volume growth falls short of expectations, disappointing investors

Hindustan Unilever Ltd’s (HUL) September quarter results (Q2FY22) weren’t encouraging for investors, which is evident from the more than 3 percent drop in its share price on the National Stock ... Read more »

Alembic Pharma Q2 PAT may dip 49.2% YoY to Rs 169.4 cr: ICICI Direct

India business helped by COVID-19 and lower base of last year rose 57 percent to Rs 481 crore. ICICI Direct has come out with its second quarter (July-September’ 21) earnings ... Read more »

Police arrest couple over heroin haul

A Hong Kong resident and his Thai wife have been arrested in Chon Buri over their alleged involvement with an international drug-smuggling ring based in Hong Kong. The arrests were ... Read more »

Cops nab 93 revellers for pub boozing

City police raided a restaurant in a shopping mall in Pathumwan district on Monday and arrested 93 party-goers who had allegedly been served alcoholic drinks. The restaurant — which has ... Read more »

Axis AMC, Inversion to raise Rs 3,500 crore buyout fund to invest in underperforming companies

Representative image Axis Asset Management Company and Inversion Advisory Services on October 19 announced a partnership to invest in underperforming companies. The two entities plan to jointly raise up to Rs ... Read more »

Nestle India Q3 Results | Profit rises to Rs 617 crore, revenue grows to Rs 3,883 crore on broad based domestic sales growth

Nestle has reached out to consumers through its advertisements in newspapers and asked them to reach out directly and raise their concerns about its products. FMCG giant Nestle India Limited, ... Read more »

Reliance Retail acquires 52% stake in Ritu Kumar brand

Ritu Kumar (Image: Company website) Reliance Retail Ventures on October 19 announced that it has acquired a 52 percent equity stake in Ritika Pvt Ltd that owns Ritu Kumar, Label Ritu ... Read more »

Coal, railway, power ministers discuss coal supply situation at power plants

Coal minister Pralhad Joshi on Tuesday discussed ways to improve coal stocks at thermal power plants with railway minister Ashwini Vaishnaw and power minister R K Singh. The meeting comes ... Read more »

Rural growth moderated in second quarter: HUL CMD Sanjiv Mehta

REUTERS/Danish Siddiqui Consumer demand in rural India, which was resilient since the onset of the pandemic, is now plateauing as the second wave of the pandemic wanes, Sanjiv Mehta, chairman ... Read more »

Baby jumbo killed in multi-vehicle pile-up

A male baby elephant was killed in a multiple-vehicle crash on a road through a forest in Sri Maha Phot district, Prachin Buri. (Photo: Manit Sanabboon) PRACHIN BURI: A male ... Read more »

Here's why Democrats' proposed elimination of Roth conversions for the wealthy doesn't start until 2032

Photo by Mike Kline (notkalvin) | Moment | Getty Images House Democrats proposed a rule to forbid Roth conversions for the wealthy as part of a broad package of tax ... Read more »

Armenia, Russia agreed on gas price — Deputy PM

Gazprom is the sole gas supplier to Armenia Read more »

ACC Q3 Result | Profit rises to Rs 449 crore, revenue grows to Rs 3748.9 crore

acc ltd ACC, one of the top cement manufacturers in India and a subsidiary of Holcim Group, reported a consolidated profit after tax of Rs 449 crore for the quarter ... Read more »

PM's charm offensive yet to convince investors to part with their trillions

As the government bids to win over the richest international investors to its green agenda, Paul Kelso finds scepticism that the government means business despite a big energy partnership with Bill Gates. Read more »

Beer prices could jump by 30p per pint as pubs struggle with staff, energy and supply shortages

There are concerns that £6 a pint could become commonplace in pubs in London and the South East. Read more »

70% of population in Bangkok now fully vaccinated

Students wait their turn to receive a Pfizer vaccine shot at Prachaniwes School in Bangkok’s Chatuchak district on Oct 4. (Photo by Chanat Katanyu) Seventy percent of the population in ... Read more »

IMF cuts Asia's growth forecast, warns of supply chain risks

The International Monetary Fund on Tuesday slashed this year’s economic growth forecast for Asia and warned that a fresh wave of COVID-19 infections, supply chain disruptions and inflation pressures pose ... Read more »

Chennai Super Kings' win in IPL 14 to dial up Dhoni's brand value

MS Dhoni has invested in companies including Khatabook, Cars24, and RunAdam Sports. (Image: IPL/BCCI/Twitter) Cricketer MS Dhoni leading his team Chennai Super Kings (CSK) to fourth win in the Indian Premier ... Read more »

Travel and tourism industry resumes hiring, momentum to pick up from Q4

The travel and tourism sector, one of the worst affected by the pandemic-induced lockdown and resultant job losses, is seeing a revival in hiring. Following the lifting of travel restrictions, ... Read more »

HeidelbergCement India Q2 profit down 4.55% to Rs 59.56 crore

HeidelbergCement India Ltd on Tuesday reported a 4.55 per cent decline in its net profit to Rs 59.56 crore for the second quarter ended September 2021 on account of increased ... Read more »

Russian media watchdog expects removal of prohibited information from Twitter — official

"Sanctions applied against them led to their removal of more than 90% of prohibited information and just a little is left to achieve complete purity," head of the regulator Andrei Lipov said Read more »

Cabinet approves B92 bn more support measures

A sign announces that a shop is participating in the Kon La Krueng (Half-Half) co-payment scheme at the Chatuchak weekend market in Bangkok. (Photo: Pornprom Satrabhaya) The cabinet on Tuesday ... Read more »

ACC profit rises to Rs 449 crore, revenue grows to Rs 3748.9 crore in September quarter

acc ltd ACC, one of the top cement manufacturers in India and a subsidiary of Holcim Group, reported a consolidated profit after tax of Rs 449 crore for the quarter ... Read more »

Technical View: Nifty forms Bearish Engulfing pattern, experts say avoid buying the dip

The Nifty started off the day above 18,600 but failed to sustain the momentum due to selling pressure in FMCG, metals, pharma and some banking & financial stocks. The index ... Read more »

DCM Shriram Q2 profit up 33.2%; says business environment remains disruptive

DCM Shriram on Tuesday posted a 33.2 per cent increase in consolidated net profit to Rs 159 crore for the second quarter of 2021-22 on strong sales. The company’s net ... Read more »

WGC predicts strong demand for gold in India in 2022 provided there are no fresh Covid outbreaks

The World Gold Council (WGC) has said that though demand for gold may be more subdued than expected this year following India’s prolonged battle with COVID-19, in 2022 economic growth ... Read more »