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Debt-ridden Chinese property developer giant Evergrande on Tuesday warned investors to "exercise caution" as the group announced it would delay the release of the results of a 2021 audit a day after halting trade in Hong Kong.
Beijing's drive to curb excessive debt in the real estate sector has embroiled Evergrande, one of the country's largest developers, which has struggled after racking up $300 billion in liabilities.
On Tuesday, a day after the company announced a halt in trading, it said it would not be able to publish its 2021 audited results by the end of the March as Hong Kong's listing rules require.
"Due to the drastic changes in the operational environment of the Company since the second half of last year... coupled with the effect caused by the Covid-19 outbreak... the Company will not be able to complete the audit procedures on time," it said in an announcement posted on Hong Kong Stock Exchange.
Suspension of its shares' trading will remain in force until the financial information is published, according to the market's rules.
The suspension is the second this year, and it comes ahead of an expected $2 billion repayment obligation on Wednesday and another next month of $1.4 billion.
In a separate announcement Tuesday, Evergrande urged investors to exercise caution "in view of the operational and financial challenges the group is facing and in particular the debt pressure it is experiencing".
The company's subsidiary Evergrande Property Services also halted trading on Monday after announcing that banks had enforced deposits of approximately 13.4 billion yuan ($2.1 billion) as security for third party pledge guarantees.
The company has repeatedly said it will finish its projects and deliver them to buyers in a desperate bid to salvage its debts.
Earlier struggles to pay suppliers and contractors due to the crisis led to protests from homebuyers and investors at the group's Shenzhen headquarters in September.
Evergrande's woes have had knock-on effects throughout China's property sector, with some smaller firms also defaulting on loans and others struggling to find enough cash.
The International Monetary Fund warned in late January that the property funding crisis could have spillover effects on the broader economy and global markets.
Asian, European markets mixed as traders track Ukraine crisis
Hong Kong (AFP) March 21, 2022 -
Asian and European markets were mixed Monday after last week's rally, while oil prices extended gains, with investors keeping tabs on the war in Ukraine as Turkey said Kyiv and Moscow were edging towards a ceasefire agreement.
Confidence remains at a premium owing to the crisis in eastern Europe -- which threatens to deal a hefty blow to the global economy -- as well as central bank monetary tightening measures.
Traders struggled to maintain the buying enthusiasm seen last week that was fuelled by bargain-buying and China's pledge to support beaten-down markets and indication that a crackdown on the tech sector was nearing an end.
Hopes for an end to the war were given a boost Sunday when authorities in Turkey, where Russian and Ukrainian representatives have been negotiating, said the two sides were close to a deal to stop the fighting.
Turkish presidential spokesman Ibrahim Kalin said the sides were negotiating six points: Ukraine's neutrality, disarmament and security guarantees, the so-called "de-Nazification", removal of obstacles on the use of the Russian language in Ukraine, the status of the breakaway Donbas region and the status of Crimea annexed by Russia in 2014.
Ukrainian President Volodymyr Zelensky on Sunday urged direct talks with Russian counterpart Vladimir Putin as the only way to end the war.
"Dialogue is the only way out," he said on CNN. "I think it's just the two of us, me and Putin, who can make an agreement on this."
After a healthy performance on Wall Street on Friday, Asia struggled to maintain momentum.
Hong Kong fell for a second day following the massive gains enjoyed on Wednesday and Thursday after Chinese authorities announced they would provide support to markets battered by recent volatility. But the lack of specifics as of Monday weighed on sentiment.
There was little major reaction after Hong Kong leader Carrie Lam unveiled plans to ease containment measures and lift a ban on flights from several countries including Britain and the United States.
Sydney, Seoul, Mumbai, Manila, Jakarta and Bangkok also slipped, but Shanghai, Singapore, Taipei and Wellington edged up. Tokyo was closed for a holiday.
London opened flat, while Paris and Frankfurt edged down. US futures were lower.
"Stabilising stock markets point to less cautious investors," said Stephen Innes of SPI Asset Management. "Not because views on geopolitical or policy/rates risk have improved but because price action shows a market more tolerant of those challenges."
Markets were sent into a tailspin when Russia invaded its neighbour almost a month ago, sending the price of commodities including oil, nickel and wheat soaring, putting further upward pressure on already high inflation.
The IMF, World Bank and other top world lenders warned last week in a joint statement that the "entire global economy will feel the effects of the crisis through slower growth, trade disruptions and steeper inflation".
And the International Energy Agency said the planet faced the "biggest oil supply shock in decades" and urged governments to implement measures to cut global crude consumption within months.
The war has complicated moves by central banks -- particularly the Federal Reserve -- to wind down their pandemic-era financial support measures as they try to walk a fine line between reining in inflation and nurturing economic growth.
"Our concern is that the Fed is tightening into an economic slowdown as it prioritises high inflation," Sue Trinh, at Manulife Investment Management, told Bloomberg Television.
"We think it will balance that trade-off of slower growth, higher inflation by lagging the market pricing in terms of the pace, the magnitude and the duration of this tightening cycle."
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