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Monday, December 6, 2021

China property shares firm after PBOC says Evergrande woes manageable

The China Evergrande Centre is seen in Hong Kong, China. August 25, 2021. REUTERS/Tyrone Siu

HONG KONG, Oct 18 (Reuters) – Shares of Chinese property developers climbed on Monday after China’s central bank calmed markets by saying spillover effects from Evergrande’s debt woes were controllable and the country’s economy is “doing well”.

Top developers Country Garden (2007.HK) and Sunac China (1918.HK) jumped over 4% and 8%, respectively, in early trading but China Vanke (000002.SZ) declined 2.6%.

The People’s Bank of China Governor Yi Gang said on Sunday China’s economy faces challenges such as default risks for certain firms due to “mismanagement”, and that authorities are keeping a close eye “so they do not become systematic risks”. read more

On Friday, another PBOC official said the spillover effect of China Evergrande Group’s (3333.HK) debt problems on the banking system were controllable and individual financial institutions’ risk exposures were not big. read more

Global financial markets have been rocked by contagion fear over a liquidity crisis at China Evergrande Group which has over $300 billion in liabilities.

The broader market (.HSI) eased 0.5%.

Reporting by Clare Jim; Editing by Stephen Coates

Our Standards: The Thomson Reuters Trust Principles.

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