The Limited Times

Now you can see non-English news...

Evergrande: Faltering real estate company causes a sell


The stock markets have long since passed their judgment on the Chinese real estate giant Evergrande. Now worries about the consequences for other sectors are mounting - the Hong Kong stock exchange is in a mood of alarm.

Enlarge image

Evergrande headquarters in Wanchai: default expected


The worsening crisis of the Chinese real estate company Evergrande led to heavy losses on the Hong Kong stock exchange on Monday.

The Hang Seng index recently lost almost four percent to 23,955 points and thus fell to its lowest level since October 2020. After the sustained decline in the past few days and weeks, the Evergrande share continued to collapse.

Most recently it lost around 17 percent and thus expanded the minus to around 85 percent in the current year.

Other Chinese real estate and financial stocks were also deeply in the red as there were fears that the crisis could spread to other companies.

The Hong Kong leading index lost almost four percent by noon.

Mainland China markets are closed on Monday and Tuesday due to public holidays.

Evergrande has accumulated debts of the equivalent of more than 256 billion euros.

Experts see a payment default as becoming more and more likely.

Multiple interest payments are due this week.

Over the weekend, the ailing Chinese real estate giant offered investors to compensate them with real estate.

The offer is therefore aimed at buyers of the company's asset management products.

Evergrande also admitted misconduct by several high-ranking managers.

Six executives illegally redeemed several of the company's investment products in advance.

The company announced on Saturday that the matter is being taken very seriously.

Most recently, rating agencies downgraded Evergrande's credit rating several times.

Since the beginning of the year, the Group's share price has fallen by over 80 percent.

"Some sort of insolvency seems likely," said Fitch, and downgraded Evergrande's credit rating.

"We believe the credit risk is high," said the agency on tight liquidity, declining sales, postponed payments to suppliers and construction companies.

mik / dpa-AFX

Source: spiegel

All business articles on 2021-09-20

You may like

News/Politics 2021-09-20T12:54:36.698Z

Trends 24h

Business 2021-10-11T01:18:47.553Z


© Communities 2019 - Privacy