Asian markets grapple with Evergrande fallout

September 28, 2021: Asian shares mainly drifted lower Tuesday as investors continued to fret over China Evergrande Group's unsolved debt crisis and eyed the potential impact of a widening power shortage in China.

In Japan, the benchmark Nikkei 225 opened down 0.32 percent at 30,142.38 points.

In Hong Kong, the Hang Seng index was up 262.56 points by 0151GMT, a rise of 1.08% at 24,471.34.

The Shanghai Composite Index started roughly flat at 3,577.89 points, dropping 4.94 points, while the Shenzhen Component Index dropped 36.76 points to 14,307.53 points.

In South Korea, the benchmark Korea Composite Stock Price Index (KOSPI) opened down 14.70 points, or 0.47% at 3,118.94 points, as of 0037GMT.

The future of Evergrande, the world's most indebted property developer, is being forensically scrutinized by investors after the company last Friday (September 24) did not meet a deadline to make an interest payment to offshore bondholders. Evergrande has 30 days to make the payment before it falls into default and Shenzhen authorities are now investigating the company's wealth management unit.

Without making reference to Evergrande, the People's Bank of China (PBOC) said Monday (September 27) in a statement posted to its website that it would “safeguard the legitimate rights of housing consumers.”

Widening power shortages in China, meanwhile, halted production at a number of factories including suppliers to Apple Inc and Tesla Inc, and are expected to hit the country's manufacturing sector and associated supply chains. Analysts cautioned the ongoing blackouts could affect the country's listed industrial stocks.

Reuters

Posted on: 2021-09-28T09:29:18+05:00

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