Yuan May Not ‘Turn Around’ China Developers, Morgan Stanley Says

China’s pledge to relax the yuan’s peg against the dollar may not be “enough for a turnaround” in the nation’s property stocks, Morgan Stanley said.

“Supportive macro factors resulting from RMB revaluation will be countered by policy uncertainty on the industry and supply pressure in the second half of 2010,” analysts led by Derek Kwong wrote in a report.

Developers with higher foreign net debt will benefit more, according to the report.