FILE PHOTO: A man wearing a protective mask during the COVID-19 outbreak is shown on an electronic board displaying stock prices outside a securities company on September 21, 2021 in Tokyo, Japan. Reuters/Kim Jeong Hoon
September 24, 2021
By Alun John and Anushka Trivedi
HONG KONG (Reuters) – Asian equities were hit on Friday as continued uncertainty about the fate of the debt-ridden Evergrande Group, despite rising risk-seeking gains on US equities and Treasury yields.
MSCI’s broadest non-Japanese Asia-Pacific stock index has remained largely unchanged after falling 0.7% this week, preparing for a third straight week of losses.
Australia’s share price fell 0.4%, but Hong Kong’s benchmark was nearly flat.
Japan’s Nikkei stock average rose 2%, but caught up with global gains after markets closed due to the holiday. Top Chinese stocks rose 0.3%, reversing early losses, as weekly investments reached 270 billion yuan ($42 billion), the biggest since January due to cash flows from central banks.
US stock futures, the S&P 500 E-Minis, rose 0.5%, while European and UK stock futures fell.
Investors remained concerned about the fate of real estate developer Evergrande, which entered a 30-day grace period following Thursday’s interest payment deadline.
Shares of Evergrande fell 11% on Friday, widening losses after a Reuters report that some offshore bondholders had not received interest payments by Thursday’s deadline. It rose 17.6% a day before the company announced it had agreed to settle interest payments on domestic bonds.
Global investors are tensed as Evergrande’s debt repayment obligations, operating under a $305 billion debt pile, have raised concerns that its malicious intent could pose systemic risks to China’s financial system. It was inside.
Ray Feliz, Credit Suisse’s chief investment officer in South Asia, said investors were concerned about the outlook for China due to the plight of the real estate sector and several regulatory changes, but there are positive sentiments elsewhere. Said.
“Growth in large advanced economies is likely to be out of trend, and monetary policy remains very supportive of asset prices by the middle of next year,” he said.
“Sometimes system shocks fix us, but because of the weight of the money needed for the house, these are less than they have been in the past few decades.”
The Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite Index all rose more than 1% overnight as investors were buoyed by the Federal Reserve’s latest tapering signal. [.N]
The Federal Reserve Board said on Wednesday it could begin reducing monthly bond purchases by November and that interest rates could rise faster than expected next year. The November time frame was largely determined by the market.
Stock market risk-on sentiment squeezed the dollar. The dollar index fell sharply overnight against a basket of its peers, falling from a one-month high to a one-week low. Although it reached its highest level against the yen since August 13, it was generally stable in Asian time. [FRX/]
The benchmark 10-year Treasury yield was just 1.444%, the highest since July 2, up 15 basis points over the past two days.
Most of the profits came overnight after Norges Bank hiked rates and scathing comments from the Bank of England, raising market expectations that the Federal Reserve Board would start to ease by the end of the year. ..
Crude oil prices rose for the fourth day in a row on global supply concerns triggered by a storm in the United States. [O/R]
Brent crude oil was up 0.2% at $77.37 and US oil was up 0.1% at $73.36.
On Friday, spot prices rose 0.5% to $1,751 an ounce and gold corrected somewhat. Higher yields hit the interest-free asset, falling more than 1% a day earlier. [GOL/]
(Reporting by Alun John of Hong Kong and Anoushka Trivedi of Bangalore, edited by Ana Nicolasi da Costa)