trouble in the Chinese bond market, although exactly why China even pretends to have a bond market escapes me.
antoine-roquentin said: they’re just allocating capital to where it fetches the highest returns :)
they most certainly are not:
State-owned miner Yongcheng Coal and Electricity Holding Group surprised investors and sparked a regulatory probe by defaulting this week on debt obligations just three weeks after it raised a billion yuan ($151 million).
That follows, among other wobbles, stress at property developer China Evergrande, a trading halt in Tsinghua Unigroup bonds after a debt warning, and the high-profile default last month of BMW partner Huachen Automotive Group.
Spooked traders dumped local debt and sold banking stocks exposed to it on Friday and analysts said the spillover could take some of the heat out of a headlong rush into Chinese debt.
“It just shows market confidence in government support is very shaky, and people are a bit more unsure now, more so than at the beginning of the year,” said Judy Kwok-Cheung, a fixed income analyst in Hong Kong at the Bank of Singapore.
“We’re still trying to gauge how much support is there still and which kind of entities they will support. We’re really watching the market closely now to see who the government will support and who they won’t.”
well, nothing has changed there.