Asian Markets Rising But Chinese Real Estate Fears Persist | Money


A passer-by wearing a protective mask walks past an electronic board showing charts of recent movements in Japan’s Nikkei stock average outside a brokerage house in Tokyo on March 6, 2020. – Photo Reuters

HONG KONG, December 8 – Asian stocks were broadly higher today after a strong advance on Wall Street, but fears persist over China’s debt-hampered real estate sector.

Major clues in New York have rallied as concerns over the impact of the Omicron coronavirus variant faded.

In Hong Kong, the Chinese real estate company Kaisa suspended operations just before the opening bell, “pending the publication by the company of an announcement containing inside information,” according to a file filed with the stock exchange.

Kaisa, China’s 27th largest real estate company but one of the most indebted, became the latest company to scare investors when it announced on Friday that it had failed in a debt swap offer that would save it time crucial.

China’s real estate sector – a key growth engine in the world’s second-largest economy – has cooled in recent months after Beijing tightened home buying rules and launched a regulatory attack on speculation.

The measures have created headaches for several large developers, including China Evergrande, the country’s second largest by volume, which has multibillion-dollar debt.

Yesterday, Evergrande missed a deadline to repay some of its foreign creditors, raising the prospect of default as it braces for government-backed mega-restructuring.

Omicron’s fears fade

At the close in Hong Kong today, the Hang Seng Index was up 0.06% to 23,996.87.

In Tokyo, the Nikkei 225 closed up 1.42% at 28,860.62.

Shanghai and Shenzhen both finished by over one percent.

“The Nikkei index was up following gains in US stocks. A wide variety of high-tech stocks were bought as fears over the Omicron variant faded, ”Okasan Online Securities said in a note.

Sydney rose more than one percent, while Wellington gained two percent. Seoul, Jakarta and Taipei were up slightly, while Singapore was down slightly.

Major European stock markets stabilized at the open today after surging in the previous session.

The London benchmark FTSE 100 gained 0.2%, while the DAX Frankfurt index and the Paris CAC also rose.

Wall Street stocks were higher for a second straight session yesterday, with the tech-rich Nasdaq advancing 3%.

Carol Kong, a strategist at the Commonwealth Bank of Australia, said early evidence for Omicron “appears to have calmed financial markets, so far, as evidenced by the rally in risky assets.”

“But we caution against drawing conclusions from these early reports.”

Global stocks and oil had collapsed on November 26 when news of the new variant first appeared on traders’ screens.

After a roller coaster ride, investors are now optimistic about the outlook heading into Christmas.

Key figures around 0810 GMT

Tokyo – Nikkei 225: UP 1.42% to 28,860.62 (close)

Hong Kong – Hang Seng Index: EN up 0.06% to 23,996.87 (close)

Shanghai – Composite: UP 1.18% to 3,637.57 (close)

New York – Dow: 1.4% to 35,719.43 (close)

London – FTSE 100: Up 0.2% to 7,350.56

West Texas Intermediate: DROP 0.93% to US $ 71.38 per barrel

North Sea Brent: DOWN 0.70% to US $ 74.91 per barrel

Euro / dollar: UP to US $ 1.1286 from US $ 1.1281

Dollar / yen: UP to 113.53 yen from 113.47 yen

Pound / dollar: LOWER to 1.3239 from 1.3248

Euro / pound: up to 85.24 pence against 85.15 pence

Bloomberg News contributed to this report – AFP


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