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Asian Markets Mixed, Chinese Real Estate Stocks Slide Amid Renewed Fears

Shares in Asia-Pacific were mixed on Tuesday, as Hong Kong-listed shares of Chinese real estate firms fell amid renewed fears.

By the market close in Hong Kong, China Evergrande Group’s stock fell 2.9% while China Vanke tanked by 4%, while Sunac China Holdings plunged 9.6%. The Hang Seng Properties index declined 0.99% to 30,203.36. The broader Hang Seng index in Hong Kong erased earlier gains and fell 0.22% to 25,099.67.

asian markets Chart
Hang seng Index Performance Chart

On Monday, Moody’s downgraded developer Yango Group, warning the Chinese firm “may not be able to mobilize all of its cash holdings to repay its maturing debts.”

That came after Yango announced an offer to swap some U.S. dollar bonds for new notes personally guaranteed by its founder and chairman as part of efforts to “avoid imminent payment defaults.” Mainland-listed shares of Yango Group plunged nearly 7% on Tuesday.

Mainland Chinese stocks closed lower as the Shanghai composite slipped 1.1% to 3,505.63 while the Shenzhen component declined 0.686% to about 14,377.27.

Elsewhere, South Korea’s Kospi jumped 1.16% on the day to 3,013.49, leading gains among the region’s major markets as shares of industry heavyweight Samsung Electronics jumped 2.29%.

The S&P/ASX 200 in Australia dipped 0.63% to close at 7,324.30. The Reserve Bank of Australia on Tuesday announced its decision to keep its cash rate target unchanged but decided to stop its target of 10 basis points for the April 2024 Australian Government Bond.

“The decision to discontinue the yield target reflects the improvement in the economy and the earlier-than-expected progress towards the inflation target. Given that other market interest rates have moved in response to the increased likelihood of higher inflation and lower unemployment, the effectiveness of the yield target in holding down the general structure of interest rates in Australia has diminished,” RBA Governor Philip Lowe said in a statement.

Following the RBA’s announcement, the Australian dollar fell to $0.7463 against an earlier high of $0.7532.

Japanese stocks closed lower on Tuesday following their Monday surge, with the Nikkei 225 falling 0.43% to 29,520.90 while the Topix index fell 0.64% to 2,031.67.

MSCI’s broadest index of Asia-Pacific shares outside Japan declined 0.19%.

Asian Markets Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 93.894 after declining recently from above 94.

The Japanese yen traded at 113.66 per dollar, stronger than levels around 114.4 seen against the greenback yesterday.

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures rose 0.55% to $85.18 per barrel. U.S. crude futures were 0.24% higher at $84.23 per barrel.

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