The Chinese authorities have called on local authorities, banks and institutions to help stabilize real estate markets and protect the rights of home buyers.
Arrows point in different directions for major Asia-Pacific stock exchanges on Thursday morning.
This is what it looks like around 6 o’clock:
- Nikkei 225 in Tokyo falls 0.35 percent
- Hang Seng in Hong Kong falls 0.86 percent
- Kospi in Seoul rises 0.50 percent
- Shanghai composite rises 0.37 percent
- FTSE Straits Times in Singapore up 0.46 percent
- ASX 200 in Sydney up 1.50 percent
Chinese authorities ask banks to support the housing market
In China, authorities have asked financial institutions to help local authorities stabilize the rapidly cooling housing market and protect the rights of some home buyers, Bloomberg reports.
At a meeting chaired by central bank governor Yi Gang, representatives from the country’s bank and security controllers, the Housing Ministry and managers from 24 banks gathered, according to the news agency.
Evergrande sells bank shares for 13 billion
They were asked to “take action and strengthen the supervisory system for real estate financing around the target of stabilization, land prices, house prices and expectations,” the news agency quotes a statement from the People’s Bank of China. .
It is taken as another sign that authorities are concerned about the outcome of the debt crisis in Evergrande.
The debt-ridden real estate company is NOK 2.6 billion in debt. On Wednesday, the company had a payment term for an interest installment, but for the second week in a row a payment term without payment was reached.
The Evergrande crisis briefly explained
Last week, the crisis in Evergrande generated turmoil in the stock market around the world. The real estate sector in China is estimated to account for 15 to 30 percent of the country’s economy, and the fear is that a possible collapse of Evergrande could spread further into the sector, the banking sector and the global economy.
“The meeting reinforces an ongoing move by Chinese authorities to address the potential risk of contagion associated with Evergrande,” said Jun Rong Yeap, marketing strategist at IG Asia, according to Bloomberg.
The industry is surprisingly retiring
The official purchasing managers index (PMI) for China manufacturing ended at 49.6 points in September, down from 50.1 in August, according to Reuters.
In a survey that the news agency did in advance, the expectation was that it would remain at the level of August.
Therefore, the country’s industrial activity fell below the 50-point limit, which means that activity is declining, the news agency writes.
– China’s economy recovered quickly from the pandemic-triggered recession last year, but momentum has weakened in recent months as its expanding industrial sector has been hit by higher prices, bottlenecks in electricity production and rationing, writes Reuters.